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AGENDA
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
IMMEDIATELY FOllOWING THE 7 PM HRA MEETING
January 27, 2009
Parkview Villa, 965 40th Avenue NE, Columbia Heights
1. Call to Order/Roll Call
Gary L. Peterson, President
Marlaine Szurek, Vice President
Bruce Kelzenberg, Secretary/Treasurer
Tammera Diehm
Bobby Williams
Bruce Nawrocki
Gerry Herringer
2. Pledge of Allegiance
CONSENT AGENDA
3. Election of Officers
President
Vice President
SecretarylTreasurer
4. Approve Minutes of September 23 and December 8, 2008 and financial report
and payment of bills for September, October, November and December 2008,
on Resolution 2009-01.
Motion: Move to Approve the consent agenda items as listed.
BUSINESS ITEMS
5. Adopt Resolution 2009-02, Rehab Incentive and Single-Family Home Deferred
loan Program Funding
Motion: Move to waive the reading of Resolution 2009-02, there being an ample
amount of copies available to the public.
Motion: Move to Adopt Resolution 2009-02, a Resolution Approving Funding for the
Rehab Incentive Program ($50,000) and the Single-Family Home Deferred Loan
Program (SFHD) ($35,000) to the Greater Metropolitan Housing Corporation
(GMHC).
6. Adopt Resolution 2009-03, 2009 Consulting Services Agreement with GMHC
Motion: Move to waive the reading of Resolution 2009-03, there being an ample
amount of copies available to the public.
Motion: Move to Adopt Resolution 2009-03, approving the 2009 Consultant Services
Agreement with the Greater Metropolitan Housing Corporation (GMHC), and
appropriating $15,000 from Fund 408- EDA Housing Maintenance for the same; and
furthermore, to authorize the President and Executive Director to enter into an
agreement for the same.
7. Adopt Resolution 2009-05, Amendment to Contract for Private Redevelopment
Motion: Move to waive the reading of Resolution 2009-05, there being an ample
amount of copies available to the public.
Motion: Move to Adopt Resolution 2009-05, Amendment to Contract for Private
Redevelopment by and Between the Columbia Heights Economic Development
Authority, Columbia Heights, Minnesota and the Greater Metropolitan Housing
Corporation, dated November 27, 2007.
8. Commercial Development Agreement for 4707 Central Avenue
Motion: Move to set a Special EDA meeting for Monday, February 9, 2009 at 6:30
p.m. in the City Hall, Conference Room 1.
9. Adopt Resolution 2009-07, Schafer Richardson Redevelopment Timeline
Motion: Move to waive the reading of Resolution 2009-07, there being an ample
amount of copies available to the public.
Motion: Move to Adopt Resolution 2009-07, a Resolution...........
10.Adopt Resolution 2009-04, Decertification of TIF Districts P3/P4/S7
Motion: Move to waive the reading of Resolution 2009-04, there being an ample
amount of copies available to the public.
Motion: Move to Adopt Resolution 2009-04, a Resolution Approving the
Decertification of Tax Increment Financing Districts P3/P4/S7 of the City of Columbia
Heights.
11. Adopt Resolution 2009-06, Amend Contract with GMHC for Additional
Financial Assistance for 4141 Jefferson Street
Motion: Move to waive the reading of Resolution 2009-06, there being an ample
amount of copies available to the public.
Motion: Move to Adopt Resolution 2009-06, Amendment to Contract for Private
Redevelopment by and Between the Columbia Heights Economic Development
Authority, Columbia Heights, Minnesota and the Greater Metropolitan Housing
Corporation dated, May 14,2007.
12.Administrative Report
13.0ther Business
The next regular EDA meeting will be Tuesdav. Februarv 24. 2009 at City Hall.
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of: January 27,2009
AGENDA SECTION: Consent Agenda ORIGINATING EXECUTIVE
NO: 3 DEPARTMENT: EDA DIRECTOR
APPROVAL
ITEM: Election of Officers BY: Cher Bakken BY:
DATE: January 20,2009
BACKGROUND: The Bylaws of the Columbia Heights EDA specify in Article II-Section 1, that
the offices of President, Vice-President, Secretary, and Treasurer be elected annually.
We have attached a Transcript of Proceedings outlining the process for nomination of persons
to the various offices.
According to Article III-Section 4 four commissioners constitutes a quorum, and as such,
election of officers may be held.
RECOMMENDATION: Move to cast a unanimous ballot nominating and appointing
for President, for
Vice President,
for Secretary;
for Treasurer.
RECOMMENDED MOTION: Move to cast a unanimous ballot nominating and appointing
for President; for Vice President;
for Secretary; for Treasurer.
Attachment
EDA ACTION:
H:\consent Form2009\EDA Election of Officers
EDA ELECTION PROCEDURES
. We will know have the Election of Officers.
. Nominations are know being taken for the office of (Office).
(After a nomination is made)
1.
has been nominated.
2. Are there any other nominations?
3. Are there any other nominations?
4. Are there any other nominations?
5. If NONE - All those in favor say aye. Opposed nay.
6. The chair declares
elected as (Office).
OATH OF COMMISSIONER OF
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
COLUMBIA HEIGHTS, MINNESOTA
I,
, do solemnly swear that I will
support the Constitution of the United States and of the State
of Minnesota and will faithfully discharge the duties of the
office of Commissioner of the Columbia Heights Economic Development
Authority, Columbia Heights, Minnesota, according
to the law and to the best of my judgment and ability, so help me God.
I do further swear that I am, and was at the time of my appointment,
a resident of Columbia Heights, Minnesota.
(s)
Subscribed and sworn to before me this
day of
, 2009.
(s)
Notary Public
My commission expires:
Economic Development Authority (EDA)
Spccial Meeting Minutes
December 8, 2008
CALL TO ORDER/ROLL CALL
President, Gary 1. Peterson called the meeting to order at 6:55 p.m.
Present:
Gary 1. Peterson, Tammera Diehm, Bruce Kelzenberg, Bruce Nawrocki, Bobby
Williams, Gerry Herringer.
Marlaine Szurek
City Manager, Community Development Director, Assistant Community Development
Director
Absent:
Staff:
PLEDGE OF ALLEGIANCE
Res.2008-16. Approvinl! the Terms of Interfund Loan in Connection with K-Mart/Central
Avenue TIF District
Staff introduced the resolution before the EDA to approve terms of an Interfund Loan in
connection with K-mart/Central Avenue TIF district. The interfund loan is for the purchase ofa
duplex located at 4636 Polk Street.
Motion by Diehm, second by Kelzenberg, to waive the Reading of Resolution 2008-16, there
being an ample amount of copies available to the public. All ayes. Motion Carried.
Motion by Diehm, second by Kelzenberg, to Adopt Resolution 2008-16, a Resolution Approving
the terms of an Interfund Loan in connection with K-Mart/Central Avenue TIF District.
Discussion: Nawrocki commented that it is premature to use these funds. He is not sure if we
should buy the property at 4636 Polk Street. Clark explained the language of the resolution.
Upon Vote: Peterson- aye, Herringer-aye, Kelzenberg -aye, Williams -aye, Nawrocki -nay,
Diehm-aye. Motion Carried.
RJo:So./,UTION NO. 2008-16
APPRo.VING THE TERMS 0.1" INTERFUND WAN
IN CONNECTION WITH K-MART/CJo:NTRAL A VENUE
711" DISTRICT
BE IT RESo.LVJo:D flY TllE Bo.ARD 0.1" COMMISSIo.NERS 0.1" THE Co.LUMBlA HEIGHTS ECo.NOMIC DEVELOPMENT
AUTHo.RITY (mE "AUTlIORITY'j AS Fo.LLOWS:
Sectionl. Backf!/'olllld
1,01. The Authority and City ofCo/ulllbia Heights ("City") have established the K-Marf/Centml Avenue Tax Increment Financing
District (the /l71fo'District") within the Celllral Business District Redewlopmenl Project (the "Project"), and have adopted a tax increment financing
plan ("TlF l'lan '') for the pl/Ipose of fil/(/IIcillg certain impl'Ovemcnls wi/hill the Project.
1.02. The Authority 01' City may inclll' certain costs related to the TIF District or Project, which costs may be financed all a
temporary busisfrom available Authority or City fimd'i.
/.03 l1/e City, /Ising {lI'ailable City fimds, intends to acquire certain property in the City located at 4636 Polk Street (the
"Property'') within the Project, all or a portioll a/which Property the Authority or City may lIse tofwther redevelopment of the Project.
1.04. The Properly is nol cu/'rento' within Ihe TlF Districl, bUllhe AUlhority inlends to e.\pwld Ihe TIP Districl boundaries 10 include
Ihe Properly, as slIch e::qJallsioll willjimher Ihe Aulhority's redevelopmenl Koals and objeclives.
1.05. 711e Authority intends to reimburse Ihe City for the cosl of acquisition of the Properly, closing cosls, and demolilion (Iogelhel~ Ihe
"Qualified Cosls") from tax il/crell/el/ls derived from the TIF District in accordance with Ihe lerms of Ihis resolution (which terms are reftrl'ed 10
colleclivelyas the "TIP Loan '').
Seclion2. Terms ofTIF Loan
2.01. SubJecl to Ihe cOl/ditiolls described in Section 2.07, Ihe Authority shall repay, 10 the City jimdfrom which Ihe Qualified Cosls are
il/itially paid 01' adwtllced, the principal amollnt ofjimds adwmced nollo exceed $116,500 logelher with intere.~1 on the principal amount adwlIlced,
accl'uingfi'011/ Ihe date of each inilial e:qJendilure 01' advance. For e>.penditures made ill 2008, the interesl rate shall be 8.0%, which is Ihe grealer of
(a) the rale specified lindeI' Minnesota Statules, Section 270C.40 01' (b) the rate specified under Minnesola Slatules, Seclio1l549.09 for 2008. For
expenditures made in 2009. the interest rale shall be reset to the greater of (a) Ihe rale Jpecified III/del' Minnesota Slatlltes, Section 270CAO or
(b) the rate specified lindeI' Milmesola Slatutes, Seclion 549.09 for 2009.
2.02. Principal and interest ("Payme1/ls'~ shall be paid semi-ml1lually 0/1 each Augusl I and Febl'llwy I ("Payment Dales"),
cOlllmencing onlhe first Payment Dale after the first advance of Qualified Costs and continuing Ihrough the earlier of (a) the date the principal and
accrued interest oflhe TIF Loan is paid infllll, 01' (b) the dale oflaslreceipt of lax il1crementji'01/1lhe TIP Districl. Payments will be made illlhe
amoullt and ollly to the extent of Available Tw: Increment as hel'einlffter defined. Payments shall be appliedfirst to accrued interesl, and then to IInpaid
principal. Interest accrllingji'om the date of each expenditure to Ihefirst Payment Dale shall be compollnded semiannually on Febl'lwI)' I and Augllst I
of each year and added 10 pl'incipal, IInless otheJ1l'ise specified by Ihe Executive Director.
2.03. Payments on this TIF Loal/ are payable solely from ''Available Tax Increment." which shall mean, 01/ each Paymenl Date, all of
lhe tax incremenl generated in the preceding six (6) months with respect to the properly withillthe TlF District and remitted to the Authority by Alloka
County, (lfier deduction of any tax incremenl allocated to administratil'e e>'7Jenses, all in accordance with Minnesota Statules, Sections 469.174 to
469.179. Paymenls OIllhis TlF Loan are subordinate to any outstanding orjillure /lotes 01' obligations issued to developel~~ or third parlies secured in
whole or in part 1I'ilh Available Tax Increment, alld are on parity with any other olllslanding orfuture inte/fimd lmms seC//red inll'hole or il/ part with
Available TeL'!; II/cremenl.
2.04. The principal s/lm and all accrued illterest payable lindeI' this TIF Loan are pre~fJayable in whole or in part at any time by the
Authority without jJremium 01' penalty. No parlial prepayment shall qffecllhe amoullt or timing oj any olher regular paymenl olhe/wise required 10 be
made under this TlF Loan
2.05. This TIF Loan is evidence of an inlen/al borrowing by the Authority in accordance 1I'ilh Minnesota Statutes, Section 469.178,
sllbdivision 7, and is a limited obligation payable solely fl'Om Available Tax Incremellt pledged 10 Ihe payment hereof under this resolulion 1Ms TIF
Loan and the interesl hereon shall not be deemed 10 conslilllte a general obligation of Ihe State of Mil/nesota or any political sllbdivision thereof,
inclllding, without Iimitalion, the City. Neither the Stale oj Minnesola, 1101' any political subdivision thereof shall be obligaled 10 pay the principal of or
il/terest 011 this TlF Loan O/' Olher costs incident hereto except out of Available Tat Increment, and neither the fullfaith and credi/nor Ihe laxing power
of the State of Minnesola or any political subdivision thereof is pledged to the paymenl of the principal of or interesl on this TlF Loan a/' other costs
il/cident hereto. 111e Authority shall have 110 obligation to pay any principal amollflt oj Ihe 711" Loan or accrued interesllhereon, which may remain
IInpaid after Ihefinal Payment Date.
2.06. nJe Authority may amend the terms of this 11F Loan at mtY time by resolution of Ihe Board, including a determinatiollto forgive
the outstanding principal amollnl alld accrued interest to the extent permissible under law.
2.07. Notwithstanding anylhing to the conlnll)' herein, as a cOlllliliolllo making allY paymentllllder the 111" Loan, Ihe Authority shall
approve, and obtain City approval of a modification of the TIF Plan to inelude Ihe Properly withinlhe 71F District area.
Section 3. Effective Date. This resolution is effictil'e uponlhe date of its approval.
Adopted this Il' day of December, 2008.
Acting Recording Secretary
Sheila Cartney, Assistant Community Development Director
ECONOMIC DEVELOPMENT AUTHORITY (EDA)
REGULAR MEETING MINUTES
September 23, 2008
CALL TO ORDER/ROLL CALL
President, Gary L. Peterson called the meeting to order at 7:01 p.m.
Present: Gary L. Peterson, Bobby Williams, Bruce Nawrocki, Tammera Diehm,
Marlaine Szurek, Gerry Herringer and Bruce Kelzenberg
Staff Present: Walter R. Fehst, Executive Director, Scott Clark, Deputy Executive
Director and EDA Attorney, Steve Bubul
Motion by Williams, Second by Diehm, to approve Scott Clark as Secretary Pro-tem.
Motion Carried Unanimously.
PLEDGE OF ALLEGIANCE
CONSENT AGENDA
Approve Minutes of August 26 and September 15, 2008 meetings and the Financial
Report and Payment of Bills for the month of August 2008 on Resolution 2008-15.
Nawrocki asked a series of questions on the claims list and the overall financial report.
Clark would get back to the EDA regarding a revenue question relating to ad valorem
taxes.
Motion by Kelzenberg, second by Williams, to approve the consent agenda All ayes.
Motion Carried.
EDA RESOLUTlDN 2008.15
RESOLUTION OF THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) APPROVING THE FINANCIAL
STA TEMENT FOR AUGUST 2008 AND PA YMENT OF BILLS FOR THE MONTH OF AUGUST 2008.
WHEREAS, the Columbia Heights Economic Development Authority (EDA) is required by Minnesota Statutes Section 469.096,
Subd. 9, to prepare a detailed financial statement which shows all receipts and disbursements, their nature, the money on hand, the
purposes to which the money on hand is to be applied, the EDA's credits and assets and its outstanding liabilities; and
WHEREAS, said Statute also requires the EDA to examine the statement and treasurer's vouchers or bills and if correct, to approve
them by resolution and enter the resolution in its records; and
WHEREAS, the financial statement for the month of August 2008 and the list of biffs for the month of August 2008 are attached
hereto and made a part of this resolution; and
WHEREAS, the EDA has examined the financial statement and the list of bills and finds them to be acceptable as to both form and
accuracy.
NOVY,. THEREFORE BE IT RESOL VED by the Board of Commissioners of the Columbia Heights Economic Development Authority
that it has examined the attached financial statements and list of biffs, which are attached hereto and made a part hereof, and they
are found to be correct, as to form and content; and
BE IT FURTHER RESOLVED the financial statements are acknowledged and received and the list of biffs as presented in writing are
approved for payment out of proper funds; and
BE IT FURTHER RESOL VED this resolution and attachments are to be made a part of the permanent records of the Columbia
Heights Economic Development Authority.
Economic Development Authority Meeting Minutes
September 23, 2008
Page 2 of 10
BUSINESS ITEMS
Resolutions 2008-12 and 13. Fourth Amendment to Contract for Private
Redevelopment-Grand Central Lofts and Contract for Private Redevelopment-
4707 Central Avenue
*At the September 15, 2008 EDA meeting staff informed the Commissioner's that the
development under consideration suffered a setback due to not being able to secure a
lease with Buffalo Wild Wings, and in turn, the project may not commence until Spring
of 2009. Staff has revised the Agreements so that it covers three possible development
scenarios: 1) the developer constructs immediately, the sanitary sewer expansion, the
Aldi's building and the parking ramp (Phase I) and the foundation for the commercial
Phase II building; 2) This fall, the developer constructs only the building foundations for
both Phases, including the parking ramp. This would allow spring construction to
commence in March of 2009; and 3) No work commencing until the spring of 2009, this
possibility creates the change in the Agreement that work must commence by May 1,
2009 but holding the completion date at December 31,2009. It is important to note that
the Pay-As-You-Go Tax Increment of $440,000 would not change and would not be
issued until the entire project is complete.
Clark presented to the EDA modifications to the 4th Amendment, specifically changes to
the Completion Certificate Section and item 4.3 regarding the completion date for
Phase 2.
Herringer was not satisfied regarding the language change for 4.3 and Bubul explained
that the language, as written, was constructed since the Housing Developer had no
contractual obligation regarding a commencement date, only a completion date for
Phase 2. The EDA agreed to no changes in language.
Herringer then stated that it was his opinion that although the Agreement definitions
stated "owner occupancy" regarding the housing units, that the EDA had previously
agreed to insert additional language within the body of the Agreement. Bubul was
directed to include this language and it was agreed that these modifications will be
made and that the EDA will receive a new copy of the Agreement.
Motion by Diehm, second by Kelzenberg, to waive the reading of Resolution 2008-12,
there being an ample amount of copies available to the public. All ayes. Motion
Carried.
Motion by Diehm, second by Kelzenberg, to Adopt Resolution 2008-12, a Resolution
Approving the 4th Amendment to Contract for Private Redevelopment and Awarding the
Sale of, and Providing the Form, Terms, Covenants and Directions for the Issuance of
its Taxable Tax Increment Revenue Notes, Series 2008A; and furthermore, to authorize
the President and Executive Director to enter into an agreement for the same. All ayes.
Motion Carried.
Nawrocki asked for a synopsis of what this Agreement was giving to the respective
Economic Development Authority Meeting Minutes
September 23, 2008
Page 3 of 10
parties. Clark gave a synopsis of the same.
Clark gave a brief review of the contract between the EDA and Grand Central
Commons LLC. Clark specifically read the new language regarding the Metropolitan
Grant to have the EDA understand that although staff was confident in gaining a one-
year extension that no contractual representation was being made regarding the same.
Clark also noted that new language regarding minimum assessment agreement
amounts and pro-rations, Section 6.3 of the contract, was also disbursed.
Herringer asked a series of questions on the tax increment note. An error was found in
the tax increment note regarding maturity date and the end date of 2018 will be
amended to read 2021, which is consistent with the rest of the Agreement.
Bubul clarified to the EDA that a tax increment note does not carry an amortization
schedule but is paid back through "available tax increment", as defined in the contract.
Tax increment proceeds are first used to pay accrued interest and then principle.
Clark also explained how the process works to develop the proposed tax increment
amount including the review by a third party of the developer's pro forma and expected
project cash flow.
The EDA will receive a new copy of the Agreement upon final draft,
Motion by Diehm, second by Williams, to waive the reading of Resolution 2008-13,
there being an ample amount of copies available to the public. All ayes. Motion
Carried.
Motion by Diehm, second by Williams, to Adopt Resolution 2008-13, a Resolution
Approving the Contract for Private Redevelopment and Resolution Awarding the Sale
of, and Providing the Form, Terms, Covenants and Directions for the Issuance of its
$440,000 Taxable Tax Increment Revenue Note, Series 2008B; and furthermore, to
authorize the President and Executive Director to enter into an agreement for the same.
All ayes. Motion Carried.
RESOLUTION NO. 2008-12
RESOLUTION APPROVING FOURTH AMENDMENT TO CONTRACT FOR PRIVATE REDEVELOPMENT AND AWARDING THE
SALE OF, AND PROVIDING THE FORM, TERMS, COVENANTS AND DIRECTIONS FOR THE ISSUANCE OF ITS TAXABLE TAX
INCREMENT REVENUE NOTES, SERIES 2008A
BE IT RESOL VED BY the Board of Commissioners ("Board'? of the Columbia Heights Economic Development Auf/1Ority,
Columbia Heights, Minnesota (the "Authority') as follows:
Section 1. Authorization: Award of Sale.
1.01. Authorization. The Authority and the City of Columbia Heights have heretofore approved the establishment of the
Kmart/Central Avenue Tax Increment Financing District (the "TlF District'? the Downtown CBD Redevelopment Project (the "Project'?, and
Ilave adopted a tax increment financing plan for the purpose of financing certain improvements within the Project. In connection with the
TlF District, the Authority entered into a Contract for Private Redevelopment between the Authority and New Heights Development, LLC
(now known as Grand Central Properties, LLC) dated as of September 22, 2004, as amended by a First Amendment thereto dated as of
April 26, 2005, a second amendment thereto dated as of November 22, 2005, a Third Amendment thereto dated as of August 28, 2007
and intends to enter into a Fourth Amendment thereto referenced below (collectively, the ''Agreement'?
Economic Development Authority Meeting Minutes
September 23, 2008
Page 4 of 10
Pursuant to Minnesota Statutes, Section 469.178, the Authority is authorized to issue and sell its bonds for the purpose of
financing a portion of the public development costs of the Project. Such bonds are payable from all or any portion of revenues derived
from the TlF District and pledged to the payment of the bonds. The Authority hereby finds and determines that it is in the best interests of
the Authority that it issue and sell its Taxable Tax Increment Revenue Notes in the principal amount of $700,000 (the "Notes'? for the
purpose of financing certain public redevelopment costs of the Project.
1.02. Aooroval of Contract Amendment. The Fourth Amendment to Contract for Private Redevelopment between the Authority
Grand Central Properties, LLC ("Grand Central Properties'? is approved in substantially the form on file in City Hall, subject to
modifications that do not alter the substance of the transaction that are approved by the President and Executive Director, provided that
execution of the amendment by such officials is conclusive evidence of and their approval.
1.03. Issuance. Sale. and Terms of the Notes. The Authority hereby delegates to the Executive Director the determination of the
date on which the Notes are to be delivered, in accordance with the Agreement. The Notes shall be issued as foffows: one Note in tl1e
original principal amount of the Housing Redeveloper Portion issued to Grand Central Properties; and one Note in the original principal
amount of the Commercial Redeveloper Portion issued to Grand Central Commons, LLC ("Grand Central Commons'?, as such terms are
defined in, and all in accordance with, the Agreement (Grand Central Properties and Grand Central Commons being referred to as the
"Owner" or "Owners'? The Notes shaJ/ be dated August 1, 2008, shall mature no later than February 1, 2014, and shall bear interest at
the rate of 6.0 % per annum from the date of original issue of the Note. The Notes are issued in consideration of payment by Grand
Central Properties of the Public Redevelopment Costs in at least the principal amount of the Notes, in accordance with the Agreement.
Section 2. Form of Note. The Notes shall be in substantially the following form, numbered R-1 and R-2, with the blanks to be
properly filled in as of the date of issue:
UNITED STATE OF AMERICA
STATE OF MINNESOTA
COUNTY OF ANOKA
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
No.R-_
$
TAXABLE TAX INCREMENT REVENUE NOTE
SERIES 2007
Rate
Date
of Oriainallssue
6.0%
August 1, 2008
The Columbia Heights Economic Development Authority ("Authority'! for value received, certifies that it is indebted and hereby
promises to pay to or registered assigns (the "Owner'?, the principal sum of $ (the "Principal Amount", as
provided in the Agreement defined hereafter, together with interest on the unpaid balance thereof accrued from the date of original issue
hereof at the rate of 6.0 percent per annum (the "Stated Rate'? This Note is given in accordance with that certain Contract for Private
Redevelopment between the Issuer and New Heights Development, LLC dated as of September 22, 2004, as amended by a First
Amendment thereto dated as of April 26, 2005, a Second Amendment thereto dated as of November 22, 2005, a Third Amendment
thereto dated as of August 28, 2007 and a Fourth Amendment thereto dated as of , 2008 (the ''Agreement'? and the
authorizing resolution (the "Resolution'? duly adopted by the Authority on August , 2008. Capitalized terms used and not
otherwise defined herein have the meaning provided for such terms in the Agreement unless the context clearly requires otherwise.
1. Pavments. Principal and interest ("Payments'? shall be paid in installments commencing February 1, 2009 and
continuing on each February 1 and August 1 thereafter to and including February 1, 2014 ("Payment Dates'?, in the amounts and from the
sources set forth in Section 3 herein. Payments shaH be applied first to accrued interest, and then to unpaid principal. Notwithstanding
anything to the contrary herein, the balance of [Housing Redeveloper Available Tax Increment) [Commercial Redeveloper Available Tax
Increment} on hand as of the date of issuance of the Note shall be paid on the date of issuance.
Payments are payable by mail to the address of the Owner or such other address as the Owner may designate upon 30 days
written notice to the Authority. Payments on this Note are payable in any coin or currency of the United States of America which, on the
Payment Date, is legal tender for the payment of public and private debts.
2. Interest. Simple interest shall accrue from the date of original issue of this Note and shaff be computed on the basis
of a year of 360 days and charged for actual days principal is unpaid.
3. Available Tax Increment.
[All payments on this Note are payable on e8cl1 Payment Date solely from and in the amount of the "Housing Redeveloper A vaiJable Tax
Increment" as defined in the Agreement that has been paid to the Authority by Anoka County in the six months preceding the Payment
Date, subject to the withholding and contingent pledge of certain Tax Increment held in escrow by the Authon.ty in accordance with Section
3.4(e)(I) of the Agreement}
Economic Development Authority Meeting Minutes
September 23, 2008
Page 5 of 10
[All payments on this Note are payable on each Payment Date solely from and in the amount of the "Commercial Redeveloper Available
Tax Increment" as defined in the Agreement that has been paid to the Authority by Anoka County in the six months preceding the Payment
Date.}
The Authority shaJJ have no obligation to pay principal of and interest on this Note on each Payment Date from any source other
than [Housing Redeveloper Available Tax Increment] (Commercial Redeveloper Available Tax Increment] and the failure of the Authority
to pay the entire amount of principal or interest on this Note on any Payment Date shall not constitute a default hereunder as long as the
Authority pays principal and interest hereon to the extent of such pledged revenues. The Authority shaff have no obligation to pay unpaid
balance of principal or accrued interest that may remain after the final Payment on February 1, 2014.
4. Default. Upon an Event of Default by the Redeveloper under the Agreement, the Authority may exercise the remedies
with respect to this Note described in Section 9.2 of the Agreement, the terms of which are incorporated herein by reference.
5. ODtional PreDavment. (a) The principal sum and aI/accrued interest payable under this Note isprepayable in whole
or in parl at any time by the Authority without premium or penalty. No parlial prepayment shaff affect the amount or timing of any other
regular payment othelWise required to be made under this Note.
(b) Upon receipt by Redeveloperofthe Authority's written statement of the Excess Amount as defined in Section 3.4(c) of
the Agreement, oneMhalf of such Excess Amount wiJJ be deemed to constitute, and will be applied to, prepayment of the principal amount
of this Note. Such deemed prepayment is effective as of the Final Closing Date as defined in Section 3A(c) of the Agreement, and will be
recorded by the Registrar in its records for the Note. Upon request of the Owner, the Authority will deliver to the Owner a statement of the
outstanding principal balance of the Note after application of the deemed prepayment under this paragraph.
6. Nature of Obliaation. This Note is one of an issue in the total principal amount of $700, 000 issued to aid in financing
cerlain pUblic redevelopment costs and administrative costs of a Project undertaken by the Authority pursuant to Minnesota Statutes,
Sections 469.001 through 469.047, and is issued pursuant to the Resolution, and pursuant to and in ful/ conformity with the Constitution
and laws of the State of Minnesota, including Minnesota Statutes, Sections 469.174 to 469.179. This Note is a limited obligation of the
Authority which is payable solely from the revenues pledged to the payment hereof under the Resolution, each Note issued under the
Resolution being on parity with the other. This Note and the interest hereon shaff not be deemed to constitute a general obligation of the
State of Minnesota or any political subdivision thereof, including, without limitation, the Authority. Neither the State of Minnesota, norany
political subdivision thereof shall be obligated to pay the principal of or interest on this Note or other costs incident hereto except from and
to the extent of the revenues pledged hereto, and neither the full faith and credit nor the taxing power of the State of Minnesota or any
political subdivision thereof is pledged to the payment of the principal of or interest on this Note or other costs incident hereto.
7. Reaistration and Transfer. This Note is issuable only as a fuJJy registered note without coupons. As provided in the
Resolution, and subject to cerlain limitations set forlh therein, this Note is transferable upon the books of the Authority kept for that
purpose at the principal office of the City Finance Director, by the Owner hereof in person or by such Owner's attorney duly authorized in
writing, upon surrender of this Note together with a written instrument of transfer satisfactory to the Authority, duly executed by the Owner.
Upon such transfer or exchange and the payment by the Owner of any tax, fee, or governmental charge required to be paid by the
Authority with respect to such transfer or exchange, there will be issued in the name of the transferee a new Note of the same aggregate
principal amount, bearing interest at the same rate and maturing on the same dates.
This Note shaJJ not be transferred to any person unless the Authority has been provided with an opinion of counselor a
cerlificate of the transferor, in a form satisfactory to the Authority, that such transfer is exempt from registration and prospectus delivery
requirements of federal and applicable state securities laws.
tT IS HEREBY CERTIFIED AND RECITED that alf acts, conditions, and things required by the Constitution and laws of the State
of Minnesota to be done, to exist, to happen, and to be performed in order to make this Note a valid and binding /imitedobligation of the
Authority according to its terms, have been done, do exist, have happened, and have been performed in due form, time and manner as so
required.
IN WITNESS WHEREOF, the Board of Commissioners of the Columbia Heights Economic Development Authority have caused
this Note to be executed with the manual signatures of its President and Executive Director, all as of the Date of Original Issue specified
above.
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
Executive Director-Walter R. Fehst
PresidentMGary L. Peterson
REGISTRA TlON PROVISIONS
The ownership of the unpaid balance of the within Note is registered in the bond register of the City Finance Director, in the
name of the person last listed below.
Date of
Signature of
Economic Development Authority Meeting Minutes
September 23, 2008
Page 6 of 10
Registration
Registered Owner _
City Finance Director
Federal Tax 1.0 No.
Section 3. Terms. Execution and Deliverv.
3.01. Denomination. Pavment. The Note shall be issued as a single typewritten note numbered R-1.
The Note shall be issuable only in fully registered form. Principal of and interest on tile Note shall be payable by check or draft
issued by tile Registrar described herein.
3.02. Dates: Interest pavment Dates. Principal of and interest on the Note shall be payable by mail to the owner of record
thereof as of the close of business on the fifteenth day of the month preceding the Payment Date, whether or not such day is a business
day.
3.03. Reaistration. The Authority hereby appoints the City Finance Director to perform the functions of registrar, transfer
agent and paying agent (the "Registrar). The effect of registration and the rights and duties of the Authority and the Registrar with respect
thereto shall be as follows:
(a) Reaister. The Registrar shall keep at its office a bond register in which the Registrar shalf provide for the registration
of ownership of the Note and the registration of transfers and exchanges of the Note.
(b) Transfer of Note. Upon surrender for transfer of the Note duly endorsed by the registered owner thereof or
accompanied by a written instrument of transfer, in form reasonably satisfactory to the Registrar, duly executed by the registered owner
thereof or by an attorney duly authorized by the registered owner in writing, the Registrar shall authenticate and deliver, in the name of the
designated transferee or transferees, a new Note of a like aggregate principal amount and maturity, as requested by the transferor.
Notwithstanding the foregoing, the Note shaJJ not be transferred to any person unless the Authority has been provided with an opinion of
counselor a cerlificate of the transferor, in a form satisfactory to the Authority, that such transfer is exempt from registration and
prospectus delivery requirements of federal and applicable state securities laws. The Registrar may close the books for registration of any
transfer after the fifteenth day of the month preceding each Payment Date and until such Payment Date.
(c) CanceJJation. The Note surrendered upon any transfer shall be promptly cancelled by the Registrar and thereafter
disposed of as directed by tl1e Authority.
(d) Imoraaer or Unauthorized Transfer. When the Note is presented to the Registrar for transfer, the Registrar may
refuse to transfer the same until it is satisfied that the endorsement on such Note or separate instrument of transfer is legally authorized.
The Registrar shall incur no liability for its refusal, in good faith, to make transfers which it, in its judgment, deems improper or
unauthorized.
(e) Persons Deemed Owners. The Authority and the Registrar may treat the person in whose name the Note is at any
time registered in the bond register as the absolute owner of the Note, whether the Note shall be overdue or not, for the purpose of
receiving payment of, or on account of, the principal of and interest on such Note and for all other purposes, and all such payments so
made to any such registered owner or upon the owners order shall be valid and effectual to satisfy and discharge the liability of the
Authority upon such Note to tl1e extent of the sum or sums so paid.
(f) Taxes. Fees and Charaes. For every transfer or excl1ange of the Note, tl1e Registrar may impose a cl1arge upon the
owner thereof sufficient to reimburse the Registrar for any tax, fee, or other governmental charge required to be paid with respect to such
transfer or exchange.
(g) Mutilated. Lost Stolen or Destroved Note. In case any Note shall become mutilated orbe lost, stolen, or destroyed,
the Registrar shall deliver a new Note of like amount, maturity dates and tenor in exchange and substitution for and upon cancellation of
such mutilated Note or in lieu of and in substitution for such Note lost, stolen, or destroyed, upon the payment of the reasonable expenses
and charges of the Registrar in connection therewith; and, in the case the Note lost, stolen, or destroyed, upon filing with the Registrar of
evidence satisfactory to it that such Note was lost, stolen, or destroyed, and of the ownership thereof, and upon furnishing to the Registrar
of an appropriate bond or indemnity in form, substance, and amount satisfactory to it, in which both the Authority and the Registrar shall be
named as obligees. The Note so surrendered to the Registrar shall be cancelled by it and evidence of sucl1 cancellation shall be given to
the Authority. If the mutilated, lost, stolen, or destroyed Note has already matured or been called for redemption in accordance with its
terms, it shall not be necessary to issue a new Note prior to payment.
3.04. Preoaration and Deliverv. The Note shall be prepared under the direction of the Executive Director and shall be
executed on behalf of the Authority by the signatures of its President and Executive Director. In case any officer whose signature shall
appear on the Note shall cease to be such officer before the delivery of the Note, such signature shall neverlheless be valid and sufficient
for all purposes, tl1e same as if such officer had remained in office until delivery. When the Note has been so executed, it shall be
delivered by the Executive Director to the Owner thereof in accordance with the Agreement.
Section 4. Securitv Provisions.
Economic Development Authority Meeting Minutes
September 23,2008
Page 7 of 10
4.01. Pledae. The Authority hereby pledges to the payment of the principal of and interest on the Notes all Housing
Redeveloper Available Tax Increment and Commercial Redeveloper Available Tax Increment, as the case may be, under the terms and
as defined in the Notes. Such revenues shall be applied to payment of the principal of and interest on the Notes, each Note being on parity
with the other, in accordance with the terms of the form of Note set forth in Section 2 of this resolution.
4.02. Bond Fund. Until the date the Note is no longer outstanding and no principal thereofor interest thereon (to the extent
required to be paid pursuant to this resolution) remains unpaid, the Authority shall maintain a separate and special "Bond Fund" to be used
for no purpose other than the payment of the principal of and interest on the Note. The Authority irrevocably agrees to appropriate to the
Bond Fund in each year all Housing Redeveloper Available Tax Increment and Commercial Redeveloper Available Tax Increment; and
agrees with respect to the Note issued to Grand Central Properties, to maintain and apply the escrowed Tax Increment in accordance with
Section 3.4(c)(i) of the Agreement. Any amount remaining in the Bond Fund shall be transferred to the Authority's account for the TlF
District upon termination of the Note in accordance with its terms.
4.03. Additional Bonds. If the Authority issues any bonds or notes secured by Available Tax Increment, such additional
bonds or notes are subordinate to the Notes in all respects.
Section 5. Certification of Proceedinas.
5.01. Certification of Proceedinas. The officers of the Authority are hereby authorized and directed to prepare and furnish
to the Owner of the Note certified copies of all proceedings and records of the Authority, and such other affidavits, certificates, and
information as may be required to show the facts relating to the legality and marketability of the Note as the same appear from the books
and records under their custody and control or as otherwise known to them, and all such certified copies, certificates, and affidavits,
including any heretofore furnished, shalf be deemed representations of the Authority as to the facts recited therein.
Section 6. Effective Date. This resolution shall be effective upon execution of the Fourth Amendment to the Agreement.
RESOLUTION NO. 2008-13
RESOLUTION APPROVING CONTRACT FOR PRIVA TE REDEVELOPMENT AND
RESOLUTION AWARDING THE SALE OF, AND PROVIDING THE FORM, TERMS, COVENANTS AND DIRECTIONS FOR THE
ISSUANCE OF ITS $440,000 TAXABLE TAX INCREMENT REVENUE NOTE, SERIES 2008B
BE IT RESOL VED BY the Board of Commissioners ("Board) of tile Columbia Heights Economic Development Authority,
Columbia Heights, Minnesota (the "Authority') as follows:
Section 1. Authorization.
1.01. Authorization. The Authority and the City of Columbia Heights have heretofore approved the establishment of the
Kmart/Central Avenue Tax Increment Financing District (the "TIF District'j the Downtown CBD Redevelopment Project (the "Project"), and
have adopted a tax increment financing plan for the purpose of financing certain improvements within the Project.
Pursuant to Minnesota Statutes, Section 469.178, the Authority is authorized to issue and sell its bonds for the purpose of
financing a portion of the public development costs of the Project. Such bonds are payable from alf or any portion of revenues derived
from the TIF District and pledged to the payment of the bonds. The Authority hereby finds and determines that it is in the best interests of
the Authority that it issue and sell its Taxable Tax Increment Revenue Note in the maximum principal amount of$440,000 (the "Note') for
the purpose of financing certain public redevelopment costs of the Project.
1.02. Aooroval of Aareement. The Contract for Private Redevelopment (the "Agreement') between the Authority Grand Central
Commons, LLC ("Grand Central Properties') is approved in substantially the form on file in City Hall, subject to modifications that do not
alter the substance of the transaction that are approved by the President and Executive Director, provided that execution of tile
amendment by such officials is conclusive evidence of and their approval. '
1.03. Issuance, Sale, and Terms of the Note. The Authority hereby delegates to the Executive Director the determination of the
date on which the Note is to be delivered, in accordance with the Agreement. The Note shall be issued to Grand Central Commons LLC
("Owner;. The Note shall be dated as of the date of delivery, shall mature no later than February 1, 2018 and shall bear interest at tile
rate of 7.0% per annum from the date of original issue of the Note. The Note is issued in consideration of payment by Ownerofcertain
Public Redevelopment Costs in at least the principa/amount of the Note, in accordance with the Agreement.
Section 2. Form of Note. The Note shall be in substantially the following form, with the blanks to be properly filled in and the
principal amount and payment schedule adjusted as of the date of issue:
UNITED STATE OF AMERICA
STATE OF MINNESOTA
COUNTY OF ANOKA
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
No. R-1
$
Economic Development Authority Meeting Minutes
September 23, 2008
Page 8 of 10
TAXABLE TAX INCREMENT REVENUE NOTE
SERIES 20_
Rate
Date
of Oriainallssue
7.0%
.20
The Columbia Heights Economic Development Authority ("Authority'? for value received, certifies that it is indebted and hereby
promises to pay to Grand Central Commons LLC or registered assigns (the "Owner'?, the principal sum of$ or so much thereof
as has been from time to time advanced (the "Principal Amount'?, as provided in the Agreement defined hereafter, together with interest
on the unpaid balance thereof accrued from the date of original issue hereof at the rate of_percent per annum (the "Stated Rate'?
This Note is given in accordance with that certain Contract for Private Redevelopment between the Issuer and the Owner dated as of
, 2008 (the "Agreement'? and the authorizing resolution (the "Resolution'? duly adopted by the Authority on
,2008. Capitalized terms used and not otherwise defined herein have the meaning provided for such terms in the
Agreement unless the context clearly requires otherwise.
I. Pavments. Principal and interest ("Payments'? shall be paid on August 1, 2010 and each Febru8lY 1 and August 1
thereafter to and including February 1, 2021 ("Payment Dates'? in the amounts and from the sources set forth in Section 3 herein.
Payments shall be applied first to accrued interest, and then to unpaid principal.
Payments are payable by mail to the address of the Owner or such other address as the Owner may designate upon 30 days
written notice to the Authority. Payments on this Note are payable in any coin or currency of the United States of America which, on the
Payment Date, is legal tender for the payment of public and private debts.
2. Interest Interest accruing from the date of original issue through and including February 1, 2010 (and not othelWise
paid from A vailable Tax Increment) will be compounded semiannually on February 1 and August 1 of each year and added to principal.
Interest shall be computed on the basis of a year of 360 days and charged for actual days principal is unpaid.
3. Available Tax Increment. AfJ payments on this Note are payable on each Payment Date solely from and in the
amount of the "Available Tax Increment, JJ which means, on each Payment Date, 90 percent of the Tax Increment attributable to the
Commercial Properly as defined in the Agreement that is paid to the Authority by Anoka County in the six months preceding the Payment
Dale.
The Authority shall have no obligation to pay principal of and interest on this Note on each Payment Date from any source other
than Available Tax Increment and the failure of the Authority to pay the entire amount of principal or interest on this Note on any Payment
Date shall not constitute a default hereunder as long as the Authority pays principal and interest hereon to the extent of such pledged
revenues. The Authority shall have no obligation to pay unpaid balance of principal or accrued interest that may remain after the final
Payment on February 1, 2021
4. Default. Upon an Event of Default by the Redeveloper under the Agreement, the Authority may exercise the remedies
with respect to this Note described in Section 9.2 of the Agreement, the terms of which are incorporated herein by reference.
5. OoUonal Preoavment. (a) The principal sum and all accrued interest payable under this Note is prepayable in whole
or in parl at any time by the Authority without premium or penalty. No partial prepayment shall affect the amount or timing of any other
regular payment otherwise required to be made under this Note.
(b) Upon receipt by Redeveloperofthe Authority's written statement of the Excess Amount as defined in Section 3.4(e) of
the Agreement, one-half of such Excess Amount will be deemed to constitute, and will be applied to, prepayment of the principal amount
of this Note. Such deemed prepayment is effective as of the Calculation Date as defined in Section 3.4(e) of the Agreement, and will be
recorded by the Registrar in its records for the Note. Upon request of the Owner, the Authority will deliver to the Owner a statement of the
outstanding principal balance of the Note after application of the deemed prepayment under this paragraph.
6. Nature of Obliaation. This Note is one of an issue in the total principal amount of $ issued to aid in
financing cerlain public redevelopment costs and administrative costs of a Project undertaken by the Authority pursuant to Minnesota
Statutes, Sections 469.001 through 469.047, and is issued pursuant to the Resolution, and pursuant to and in full conformity with the
Constitution and laws of the State of Minnesota, including Minnesota Statutes, Sections 469.174 to 469.179. This Note is a limited
obligation of the Authority which is payable safely from the revenues pledged to the payment hereof under the Resolution. This Note and
the interest hereon shall not be deemed to constitute a general obligation of the State of Minnesota or any political subdivision thereof,
including, without limitation, the Authority. Neither the State of Minnesota, nor any political subdivision thereof shall be Obligated to pay
the principal of or interest on this Note or other costs incident hereto except from and to the extent of the revenues pledged hereto, and
neither the full faith and credit nor the taxing power of the State of Minnesota or any political subdivision thereof is pledged to the payment
of the principal of or interest on this Note or other costs incident hereto.
7. Reaistration and Transfer. This Note is issuable only as a fully registered note without coupons. As provided in the
Resolution, and subject to cerlain /imitations set forlh therein, this Note is transferable upon the books of the Authority kept for that
purpose at the principal office of the City Chief Financial Officer, by the Owner hereof in person or by such Owner's attorney duly
Economic Devclopmcnt Authority Meeting Minutes
September 23, 2008
Page 9 of 10
authorized in writing, upon surrender of this Note together with a written instrument of transfer satisfactory to the Authority, duly executed
by the Owner. Upon such transfer or exchange and the payment by the Owner of any tax, fee, or governmental charge required to be paid
by the Authority with respect to such transfer or exchange, there will be issued in the name of the transferee a new Note of the same
aggregate principal amount, bearing interest at the same rate and maturing on the same dates.
This Note shall not be transferred to any person unless the Authority has been provided with an opinion of counselor a
certificate of the transferor, in a form satisfactory to the Authority, that such transfer is exempt from registration and prospectus delivery
requirements offederal and applicable state securities laws.
IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions, and things required by the Constitution and laws of the State
of Minnesota to be done, to exist, to happen, and to be performed in order to make this Note a valid and binding limited obligation of the
Authority according to its terms, have been done, do exist, have happened, and have been performed in due form, time and manner as so
required.
IN WITNESS WHEREOF, the Board of Commissioners ofthe Columbia Heights Economic Development Authority have caused
this Note to be executed will1 the manual signatures of its President and Executive Director, all as of the Date of Original Issue specified
above.
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
Executive Director-Walter R. Fehst
President-Gary L. Peterson
REGISTRATION PROVISIONS
The ownership of the unpaid balance of the within Note is registered in the bond register of the City Chief Financial Officer, in
the name of the person last listed below.
Date of
Registered Owner _
Signature of Registration
City Chief Financial Officer
Grand Central Commons LLC
Federal Tax 1.0. No.
Section 3. Terms Execution and DelivetV.
3.01. Denomination. Pavment. The Note shaff be issued as a single typewritten note numbered RM1.
The Note shall be issuable only in fully registered form. Principal of and interest on the Note shall be payable by check or draft
issued by the Registrar described herein.
3.02. Dates' Interest Pavment Dates. Principal of and interest on the Note shall be payable by mail to the owner of record
thereof as of the close of business on the fifteenth day of the month preceding the Payment Date, whether or not such day is a business
day.
3.03. Reaistration. The Authority hereby appoints the City Chief Financial Officer to perform the functions of registrar,
transfer agent and paying agent (the "Registrar'1. The effect of registration and the rights and duties of the Authority and the Registrar
with respect thereto shall be as follows:
(a) Reaister. TI1e Registrar shall keep at its office a bond register in which the Registrar shall provide for the registration
of ownership of the Note and the registration of transfers and exchanges of the Note.
(b) Transfer of Note. Upon surrender for transfer of the Note duly endorsed by the registered owner thereof or
accompanied by a written instrument of transfer, in form reasonably satisfactory to the Registrar, duly executed by the registered owner
thereof or by an attorney duly authorized by the registered owner in writing, the Registrar shall authenticate and deliver, in the name of the
designated transferee or transferees, a new Note of a like aggregate principal amount and maturity, as requested by the transferor.
Notwithstanding the foregoing, the Note shall not be transferred to any person unless the Authority has been provided with an opinion of
counselor a certificate of the transferor, in a form satisfactory to the Authority, that such transfer is exempt from registration and
prospectus delivery requirements of federal and applicable state securities laws. The Registrar may close the books for registration of any
transfer after the fifteenth day of the month preceding each Payment Date and until such Payment Date.
(c) Cancellation. The Note surrendered upon any transfer shall be promptly cancel/ed by the Registrar and thereafter
disposed of as directed by the Authority.
(d) Imorover or Unauthorized Transfer. When the Note is presented to the Registrar for transfer, the Registrar may
refuse to transfer the same until it is satisfied that the endorsement on such Note or separate instrument of transfer is legally authorized.
Economic Development Authority Meeting Minutes
September 23,2008
Page 10 of 10
The Registrar shall incur no liability for its refusa', in good faith, to make transfers, which it, in its judgment, deems improper or
unauthorized.
(e) Persons Deemed Owners. The Authority and the Registrar may treat the person in whose name the Note is at any
time registered in the bond register as the absolute owner of the Note, whether the Note shall be overdue or not, for the purpose of
receiving payment of, or on account of, the principal of and interest on such Note and for afl other purposes, and all such payments so
made to any such registered owner or upon the owner's order shall be valid and effectual to satisfy and discharge the liability of the
Authority upon such Note to the extent of the sum or sums so paid.
(f) Taxes. Fees and Charaes. For every transfer or exchange of the Note, the Registrar may impose a c/7arge upon the
owner thereof sufficient to reimburse the Registrar for any tax, fee, or other governmental charge required to be paid with respect to such
transfer or exchange.
(g) Mutilated Lost Stolen or Desfroved Note. In case any Note shall become mutilated or be lost, stolen, or destroyed,
the Registrar shall deliver a new Note of like amount, maturity dates and tenor in exchange and substitution for and upon cancellation of
such mutilated Note or in lieu of and in substitution for such Note lost, stolen, or destroyed, upon the payment of the reasonable expenses
and charges of the Registrar in connection therewith; and, in the case the Note lost, stolen, or destroyed, upon filing with the Registrar of
evidence satisfactory to if that such Note was lost, stolen, or destroyed, and of the ownership thereof, and upon furnishing to the Registrar
of an appropriate bond or indemnity in form, substance, and amount satisfactory to it, in which both the Authority and the Registrar shaf/ be
named as obligees. The Note so surrendered to the Registrar shalf be cancelled by it and evidence of such cancellation shaf/ be given to
the Authority. If the mutilated, lost, stolen, or destroyed Note has already matured or been called for redemption in accordance with its
terms, it shall not be necessary to issue a new Note prior to payment.
3.04. Preoaration and Deliverv. The Note shall be prepared under the direction of the Executive Director and shall be
executed on behalf of the Authority by the signatures of its President and Executive Director. In case any officer whose signature shall
appear on the Note shalf cease to be such officer before the delivery of the Note, such signature shall nevertheless be valid and sufficient
for all purposes, the same as if such officer had remained in office until delivery. When the Note has been so executed, it shall be
delivered by the Executive Director to the Owner thereof in accordance with the Agreement.
Section 4. Securitv Provisions.
4.01. Pledae. The Authority }7ereby pledges to the payment of the principal of and interest on the Note all Available Tax
Increment under the terms and as defined in the Note. Available Tax Increment shall be applied to payment of the principal of and interest
on the Note in accordance with the terms of the form of Note set forth in Section 2 of this resolution.
4.02. Bond Fund. Until the date the Note is no longer outstanding and no principal t/7ereof or interest thereon (to the extent
required to be paid pursuant to this resolution) remains unpaid, the Authority shall maintain a separate and special "Bond Fund" to be used
for no purpose other than the payment of the principal of and interest on the Note. The Authority irrevocably agrees to appropriate to the
Bond Fund in each year all A vailabfe Tax Increment. Any A vailable Tax Increment remaining in the Bond Fund shalf be transferred to the
Authority's account for the T1F District upon termination of the Note in accordance with its terms.
4.03. Additional Bonds. If the Authority issues any bonds or notes secured by Available Tax Increment, such additional
bonds or notes are subordinate to the Note in all respects.
Section 5. Cerlification of Proceedinos.
5.01. Cerlificafion of Proceedinas. The officers of the Authority are hereby authorized and directed to prepare and furnish
to the Owner of the Note certified copies of all proceedings and records of the Authority, and such other affidavits, cerlificates, and
information as may be required to show the facts relating to the legality and marketability of the Note as the same appear from the books
and records under their custody and control or as othelWise known to them, and all such cerlified copies, certificates, and affidavits,
including any heretofore furnished, shalf be deemed representations of the Authority as to the facts recited therein.
Section 6. Effective Date. This resolution shall be effective upon execution of the Agreement.
ADJOURNMENT
President, Peterson, adjourned the rneeting at 7:50 p.rn.
s~
Scott Clark
\
H :\EDArn i nutes2008\9-23-2008
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of January 27, 2009
AGENDA SECTION: Consent Agenda ORIGINATING EXECUTIVE
NO: 4 DEPARTMENT: EDA DIRECTOR
APPROVAL
ITEM: Adopt Resolution 2009-01, Financial BY: Cher Bakken BY:
Report and Payment of Bills DATE: January 20, 2009
BACKGROUND:
The bound Financial Report for the months of September, October, November and December 2008
draft Resolution 2009-01 is attached for review. The enclosed Financial Report lists the Summary
(white), the Check History (Green), the Expenditure Guideline with Detail (blue) and Revenue Guideline
with detail (yellow) for each fund. The reports cover the activity in the calendar (fiscal) year from
January 1 through December, 2008.
RECOMMENDATION:
Staff will be available to answer specific questions. If the report is satisfactorily complete, we
recommend the Board take affirmative action to receive the Financial Report and approve the payment
of bills.
RECOMMENDED MOTION:
Move to waive the reading of Resolution 2009-01, there being an ample amount of copies available to
the public.
Move to approve Resolution 2009-01, Resolution of the Columbia Heights Economic Development
Authority (EDA) approving the Financial Statement and Payment of Bills for the months of September,
October, November and December 2008.
EDA ACTION:
H:\EDAConsenI2009\Sepl, Ocl, Nov, Dec. Fin Rep 2008
EDA RESOLUTION 2009-01
RESOLUTION OF THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
(EDA) APPROVING THE FINANCIAL STATEMENT FOR SEPTEMBER, OCTOBER,
NOVEMBER AND DECEMBER 2008 AND PAYMENT OF BillS FOR THE MONTHS OF
SEPTEMBER, OCTOBER, NOVEMBER AND DECEMBER 2008.
WHEREAS, the Columbia Heights Economic Development Authority (EDA) is required by
Minnesota Statutes Section 469.096, Subd. 9, to prepare a detailed financial statement which
shows all receipts and disbursements, their nature, the money on hand, the purposes to which
the money on hand is to be applied, the EDA's credits and assets and its outstanding liabilities;
and
WHEREAS, said Statute also requires the EDA to examine the statement and treasurer's
vouchers or bills and if correct, to approve them by resolution and enter the resolution in its
records; and
WHEREAS, the financial statement for the months of September, October, November and
December 2008 and the list of bills for the months of September, October, November and
December 2008 are attached hereto and made a part of this resolution; and
WHEREAS, the EDA has examined the financial statement and the list of bills and finds them to
be acceptable as to both form and accuracy.
NOW, THEREFORE BE IT RESOLVED by the Board of Commissioners of the Columbia
Heights Economic Development Authority that it has examined the attached financial statements
and list of bills, which are attached hereto and made a part hereof, and they are found to be
correct, as to form and content; and
BE IT FURTHER RESOLVED the financial statements are acknowledged and received and the
list of bills as presented in writing are approved for payment out of proper funds; and
BE IT FURTHER RESOLVED this resolution and attachments are to be made a part of the
permanent records of the Columbia Heights Economic Development Authority.
Passed this _ day of
,2009.
MOTION BY:
SECONDED BY:
AYES:
NAYS:
President
Attest by:
Cheryl Bakken, Assistant Secretary
H:\Resolutions2009\EDA2009-01 fin Sept, Oct, Nov., Dec. 2008
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
Meetinq of January 27, 2009
AGENDA SECTION: Business Items ORIGINATING DEPARTMENT: EXECUTIVE
NO: 5 Community Development DIRECTOR
APPROVAL
ITEM: Adopt Resolution 2009-02, Approving BY: Sheila Cartney BY:
funding for the Rehab Incentive Program DATE: January 21,2009
and the Single-Family Home Deferred
Loan Program (SFHD).
Introduction
Staff requests that the Columbia Heights Economic Development Authority (EDA) authorize
$50,000 of funding for the Columbia Heights Rehab Incentive Program and $35,000 for the new
Single-Family Home Deferred Loan Program (SFHD). Both programs are included in the Housing
Maintenance Plan 2008 - 2017, approved by the EDA on August 18, 2007. The Greater
Metropolitan Housing Corporation (GMHC) administers the programs for the City and will continue
to do so, based on EDA action regarding the same.
Rehab Incentive Program
The Columbia Heights Rehab Incentive Program is designed to assist homeowners in the City in
maintaining and improving their homes by providing a rebate to homeowners after an improvement
has been completed. The upgrades foster a stabilization and revitalization of the City's housing
stock. Homeowners of single-family or owner-occupied duplexes with a household income at 115%
of the area median income or less are eligible to apply. Calculated as a percentage of total
construction costs, a rebate payment of 10%, 12% or 15% may be granted, up to $3,000.
Examples of eligible improvements include repairing or replacing dilapidated porches, roofs,
retaining walls, siding, exterior steps or railings and heating, plumbing or electrical systems.
Single-Family Home Deferred Loan Program (SFHD)
The purpose of the Single-Family Home Deferred Loan Program (SFHD) is to provide no- or low-
interest loans to homeowners of lower income to complete structural improvements that would help
maintain the quality of their homes and the City's housing stock. Assistance is targeted at
homeowners who need to perform home maintenance, but who may not be able to pay a monthly
debt service of a conventional loan.
The SFHD would provide half of the total project costs, or up to $7,500, in a deferred loan to
homeowners making 80% of the median area income or less. To qualify for the program, the
homeowner must provide matching funds for the remaining project costs. Home equity loans or an
MHFA loan qualify as matching funds. Exterior home improvements related to health and safety,
code violations or energy efficiency, such as windows, siding and roofs would be eligible.
Repayment of the loan, plus simple interest of two percent, will be required upon sale of the house
or transfer of title. The homeowner can use the proceeds from the sale of the house to pay the
loan. Repaid loans will be returned to the funds available to finance future loans. A lien applied to
the property ensures that the loan will be repaid.
Recommendation: Staff recommends the EDA fund the Rehabilitation Incentive Program in the
amount of $50,000 and the Single-Family Home Deferred Loan in the amount of $35,000 from
Fund 408 - EDA Housing Maintenance Programs. Staff is recommending a small increase in each
fund due to past success of these programs. Fund 408 has a cash balance of $231,576, and
receivable of $600,000.
Recommended Motion:
Move to waive the reading of Resolution 2009-02, there being an ample amount of copies
available.
Move to Adopt Resolution 2009-02, a Resolution Approving funding for the Rehab Incentive
Program in the amount of $50,000 and the Single-Family Home Deferred Loan Program (SFHD) in
the amount of $35,000 to the Greater Metropolitan Housing Corporation (GMHC) from Fund 408 -
EDA Housing Maintenance Programs.
Attachments: Resolution, Monthly status reports
EDA ACTION:
EDA RESOLUTION NO. 2009-02
A RESOLUTION APPROVING FUNDING FOR THE REHAB INCENTIVE
PROGRAM ($50,000) AND THE SINGLE-FAMILY HOME DEFERRED LOAN
PROGRAM (SFHD) ($35,000) TO THE GREATER METROPOLITAN HOUSING
CORPORATION (GMHC)
WHEREAS, the Columbia Heights Economic Development Authority (EDA)
through its Comprehensive Plan has established as a goal the preservation of
the single-family housing stock.
WHEREAS, the EDA approved the Housing Maintenance Plan 2008-2017 to
improve and maintain the residential homestead housing stock.
WHEREAS, the Greater Metropolitan Housing Corporation has agreed to provide
consulting services.
WHEREAS, the Greater Metropolitan Housing Corporation has provided housing
preservation services since 2002.
THEREFORE, BE IT RESOLVED, that the EDA allocates $50,000 for the Rehab
Incentive Program and $35,000 for the Single-Family Home Deferred Loan
Program to the Greater Metropolitan Housing Corporation from Fund 408 - EDA
Housing Maintenance Funding.
Passed this
day of
,2009.
Offered by:
Seconded by:
Roll Cali:
President-
Walter R. Fehst, Executive Director
HousingResource Center - Northeast
City of Colum~ia Hei hts Monthlv Status Reoort - End of December 2008
MHFA Rehab Incen<lve t'rogram
- 1----
Program Pool: $45,000,00_
AQQlic~tionssentthismonth: ___ -.- 0 ~_____t-_,_
Applications given out at 2005 Columbia Heights Fair 51 __
Applications received: 0
Applications in process: 0
Rebates dosed to date: 32
Iotal project cost: $453,871.83
Total rebate funds given this month: __ $0.00
Total rebate funds given to date: <I; 45000.00
Total pro'gram funds remaining in --;;001: #REF!
I I
* MHFA FIX Un Fund
TotaJJoan funds gjven this month __
OFfOtalloans funds given to date
Pro. eet Address Rebate Pro. eet Cost Pro' eet
* 4218 2nd St. NE <582.50 <5825.00 basement finishinn
4044 5lh 51. NE 912.84 <7607.00 Windows
* 3960 Cleveland Ave. <1:3000.00 $25207.00 Drivewall fence
1036 42nd Ave. NE <823.90 $8 239.00 Stucco
* 120140th Ave. NE $2685.33 22377.77 bathroom refinishina
4323 6th 51. NE <1 104.43 13 910.00 Garaoe reolacement
!j:n~~~i~~~!~~~~Ne~"y 7{~i~~ !y ~~!~:~i~~ :~::::
4138 Jefferson 51. NE <1790,00 $17900,00 balhroom refinishin"
4717 Unland Crest ~1 545.00 $10300.00 5iddin"
4244 7th 5t NE <170.00 <1700.00 eoress window
1010 43rd Ave. NE 350.00 <3 500.00 windows
# 1036 Gould Ave. NE <3000.00 $66977.28 General remodelin"
5200 6th 51. NE ~1870.00 $18700.00 Windows
5015 Johnson 51. NE <2 256.50 <22 565.00 windows/oaraoe add
4441 2nd 51. NE 460.80 <3840.00 HAVC
805 50th Ave. Ne <1725.00 $17250.00 bathroom remodel
5250 Washin"ton 51. NE T3 000.00 $27 213.52 General remodelinn
*422S Jefferson St. NE <1743.60 <14530.00 Windows/Roof
4854 Monroe 51. NE <1 477.50 <9850.00 Drivewav
4419 Madison 51. NE <667.50 $6675.00 Furnace/Gara"e
3817 Buchanan 51. NE Q 509.22 $25092.29 Floors
*4232 6th Street NE <1044.00 <8700.00 Windows
*938421/2 Avenue NE; t!S"0l009;;!; $o.OO"lleneral'femddelln;;,'
4957 Jefferson 51. NE <478.80 3 990.00 Reroof House
3705 Van Buren 51. NE T3 000.00 29 067.00 Enclosed Porch
3857 nuinc:v 51. NE <3000.00 31000.00 Garaoe
f;,! "f'oSI95'(00f'" 13'300(00;"; "
~e,rrace",...,...~16~:,~og~.,!..g.;,
~"NEi;";;:;''''~'235'97':''
Closin
8/1402
9/402
9402
9/19/02
10 9/02
1015/02
11 18 02
2502" "
2 17 03
3 10 03
3 20 03
3 24 03
4203
4803
423 03
5 15 03
5 19 03
53003
6 17 03
7 15 03
7703
7803
7 11/03
814/03
4 12/2005
5711/2005
6 2/2005
"",,' /7/05' .,..
Gen Remodel/Plumblnn 6 15/05
~;or.;~e~~:~i:ri~~ ~7/05)d;'
Total <45 000.00 $453 871.83
MHFA Particinants
4605 7th Street NE
3850 Jackson 51. NE
1434 42nd Ave, NE
43354th 51. NE
1493 Lincoln Terrace
3731 Quincv 51. NE
1493 Lincoln Terrace
4212 6th 51. NE.
4059 4th 51. NE.
4156 5th 5t.JJS_.,
0,00
0,00
0.00
0.00
<0.00
$0.00
$0.00
$0.00
11 668.60 General remodelinn
12 115.00 Bathroom Remodel
12 103.00 Windows/Heatino
$23 288.64 Garaoe/Gen Remodel
$25 902.55 Kitchen Remodel
$34673,00 Gen Remodel/Gara"e
<1;30 156,07 lumbinn/Gen Remodel
6 150.00 Sidino
2900.00 Fuenace/AC
$15,715.63 Siding/Mise Renairs
10 28/03
51704
S 26 04
71204
726 04
10 26 04
6 15/05
10 24/05
11 18/05
12/13/05
$6,138.88
$329,095,43
Status
Comnleted
Com leled
Comoleted
Comnleted
Comnleted
Com leted
Comoleted
"l3utof'pr66ram' "'"
Comnleted
Comoleted
Comnleted
Comnleted
Comnleted
Comoleted
Comoleted
Comnleted
Comnleted
Comoleled
Comoleted
Comnleted
Comoleted
Comoleted
Comnleted
Comnleted
Comoleted
Comnleted
Comnleted
I'
~
RBO/o
10
12
12
10
12
15
12
--e--
1
2
3
4
5
6
7
15
10
15
10
10
15
10
10
10
10
12
12
15
10
10
12
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
'.'25" "
26
27
28
,:,.'''29 '
30
;>..31". ,
;WF32:;i\;T0
12
12
12
12
0%
0%
0%
0%
0%
0%
0%
---
Special Notice: Some of this Information portrayed in this report consist of "Private Data" as defined by the Minnesota Government Data
Pratices Act. This list/report MUST NOT be reproduced and/or distributed
1(0 Total loan funds aiven to date has been ad1usted bV=t207. A total nroiect cost of $25207.00 was added
to total loan funds when the loan was actuallv :1;25 000.00
I I
I I
"'Y 01 ,-,0 U,ll elgms tenao ncentlve t-'rogram
End of September 2007
....J,
<-~~
Greater Metropolitan Housing Corporation
City of Columbia Heights - Deferred Loan Program
September 30, 2008
Amount
Deferred Loan Pool: $30,643.00 (Funds Held @ GMHC)
1 04/07/08 White, Christopher & Stacy 4146 Wahington St NE 3,122.00
2 OS/28/08 Palmer, Ryan M. 4932 6th St NE 2,838.50 $5,960.50 7/1612008
3 07/22/08 Modahl, Aaron J. 1019 Gould Ave NE 7,500.00
4 07/23/08 Lewis, Glenna M. 4456 Monroe St NE 7,500.00
5 07/31/08 Sheehan, Susan E. 4816 5th SI NE 3,905.00
6 09/23/08 Montague, Lynette 3930 Tyler St NE 5,777.50 $24,682.50 9/30/2008
Total Closed Loans: $30,643.00 $30,643.00, Total Billings
Deferred Loan Pool Balance: $0.00
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meetina of January 27, 2009
EXECUTIVE
AGENDA SECTION: Business Items ORIG.DEPARTMENT DIRECTOR
NO.6 Community Development APPROVAL
BY:
ITEM: Adopt Resolution 2009-03, BY: Sheila Cartney
Consultant Services Agreement with the DATE: January 21, 2009
Greater Metropolitan Housing Corporation
BACKGROUND: Since 2002, the EDA has partnered with the Greater Metropoiitan Housing
Corporation (GMHC) and its HousingResource Center to provide the residents of Columbia
Heights with a variety of housing services to help maintain and improve their homes. The
services provided are of great value to residents, as they have access through the organization to
information on such issues as home rehabilitation or mortgage foreclosure prevention, and can
receive construction consultation services. In addition, residents can access home rehabilitation
funds through MHFA Fix-Up Fund loan, the City's Rehab Incentive Fund or the City's Single-
Family Home Deferred Loan Program.
The complete list of services is listed in section 1. Scope of Services in the attached Consultant
Services Agreement.
Staff recommends the EDA enter into an agreement with the HousingResource Center at a cost
of $15,000 for the year 2009. The $15,000 annual fee gives residents access at no cost to the
services of GMHC's HousingResource Center, where they can receive information on nearly any
topic related to housing and construction consultation, as well as apply for GMHC-administered
programs, such as the Fix-Up Fund, the Columbia Heights Rehab Incentive Program or the new
Single-Family Home Deferred Loan Program. Funding is available from Fund 408 - EDA
Housing Maintenance Fund. The Consultant Services Agreement begins 1/1/2009 and ends
12/31/2009 and can be terminated by either party with 30 days' notices. See attached
agreement for further details.
RECOMMENDATION: Staff recommends Adoption of Resolution 2009-03 approving the 2009
Consultant Services Agreement with the Greater Metropolitan Housing Corporation (GMHC), and
appropriating $15,000 from Fund 408 -EDA Housing Maintenance Fund for the same.
RECOMMENDED MOTION: Move to waive the reading of Resolution 2009-03, there being an
ample amount of copies available.
Move to Adopt Resolution 2009-03, a Resolution approving the 2009 Consultant Services
Agreement with the Greater Metropolitan Housing Corporation (GMHC), and appropriating
$15,000 from Fund 408 -EDA Housing Maintenance Fund for the same; and furthermore, to
authorize the President and Executive Director to enter into an agreement for the same.
Attachments: Resolution, Consultant Services Anreement
EDA ACTION:
EDA RESOLUTION NO. 2009-03
A RESOLUTION APPROVING THE 2009 CONSULTANT SERVICES AGREEMENT WITH
THE GREATER METROPOLITAN HOUSING CORPORATION (GMHC) AND
APPROPRIATING $15,000 FROM FUND 408 - EDA HOUSING MAINTENANCE FUND
FOR THE SAME.
WHEREAS, the Greater Metropolitan Housing Corporation (GMHC) has agreed to
provide consulting services.
WHEREAS, the Columbia Heights Economic Development Authority through its
Comprehensive Plan has established as a goal the preservation of the single-family
housing stock.
WHEREAS, the Greater Metropolitan Housing Corporation has provided housing
preservation services since 2002.
WHEREAS, the residents have found these services to be a significant assistance to
help preserve and maintain their homes.
THEREFORE, BE IT RESOLVED, that the EDA approves the 2009 Consultant Services
Agreement with the Greater Metropolitan Housing Corporation and appropriates $15,000
from Fund 408 - EDA Housing Maintenance Fund for the same.
Passed this
day of
,2009
Offered by:
Seconded by:
Roll Call:
President-
Walter R. Fehst, Executive Director
CONSULTANT SERVICES AGREEMENT
THIS IS AN AGREEMENT entered into the _ day of ,200_, by and
between the Columbia Heights Economic Development Authority, ("EDA"), and GREATER
METROPOLITAN HOUSING CORPORATION, a Minnesota non-profit corporation
("Consultant").
RECITALS
A. The Consultant has a division called The Housing Resource Center ("HRC").
GMHC has agreed to provide certain Services through HRC (as defined below) in connection
with the EDA's housing program.
B. The EDA desires to hire the Consultant to render this technical, professional, and
marketing assistance in connection with housing programs in the EDA for the term as set forth in
this Agreement.
C. Consultant is willing to provide such services on the terms and conditions set
forth herein.
In consideration of the foregoing recitals and following terms, conditions and mutual
promises contained herein, the parties agree as follows:
I. Scope of Services. The Consultant shall provide services as follows (the
"Services"):
a. Administer the following home improvement programs for residents of the City
of Columbia (the "City"): MHFA Fix Up Fnnd, Community Fix Up Fund, and
the MHF A Rental Rehab Program (collectively the "MHF A Programs"); City of
Columbia Heights Rebate Incentive Program and City of Columbia Heights
Single-Family Deferred Program:
I. Providing information to residents and property owners about the
programs, upon request; assisting the City with marketing materials
through various mediums;
2. Assist the EDA in developing procedures for the programs;
3. Receipt of applications from residents;
4. Processing applications;
5. Closing loans to qualified applicants in accordance with the applicable
program;
6. Overseeing the draw process for the funds, including, as necessary,
reviewing draws, reviewing the progress of the work and collecting lien
waivers and certificates of occupancy. Consultant may, for this purpose,
rely on third-party representations and certifications.
7. Provide monthly reports about the number of loans closed and the balance
in each loan program.
fb.us.3166730.04 1
b. Assist City residents considering rehabilitation, including propelty visits, meet
with homeowners and potential contractors, suggest alternatives for rehabilitation
to homeowners, educate homeowners on the construction bid process, assist
homeowners to evaluate bids and work completed and constmction progress.
c. Provide housing information to City residents, including information on
emergency assistance, housing rehabilitation, first time homebuyers and limited
rental information;
d. Assist the EDA in developing programs to purchase and rehabilitate homes;
e. Coordinate these services out of Consultant's Northeast office; and
f. Have Consultant's staff visit residences as determined necessary by Consultant.
2. Term. This Agreement shall be in full force and effect from January 1,2009 and
shall continue through December 31, 2009, unless otherwise terminated as set forth below.
3. Compensation.
For services provided under this Agreement, the EDA shall pay to the Consultant
Fifteen Thousand Dollars ($15,000.00) within thirty (30) days after execution of this Agreement.
The Consultant shall receive compensation for administering the MHF A Programs
directly from the Minnesota Housing Finance Agency and not fi'om the EDA.
4. Termination. Notwithstanding any other provision hereof to the contrary, this
Agreement may be terminated as follows:
a. The parties, by mutual written agreement, may terminate this Agreement at any
time in which case the parties shall agree to the amount of fees payable to
Consultant.
b. EDA may terminate this Agreement upon the breach by Consultant of any of its
material covenants contained herein, where such breach shall have continued for a
period of thirty (30) days following the receipt by Consultant of a written notice
fi'om EDA, specifying the alleged breach; provided, however, if the nature of a
non-monetary breach is such that Consultant cannot reasonably cure same in the
thirty (30) day period, Consultant shall not be deemed to be in breach if it
commences to cure within the thirty (30) day period, and diligently pursues same
to completion within ninety (90) days following receipt by Consultant of such
written notice. In the event of termination by EDA hereunder, Consultant shall be
entitled to fees due to the date the notice of breach is sent by the EDA.
c. If Consultant or EDA (as applicable) (i) files a voluntary petition in bankruptcy
(ii) files a voluntary petition for reorganization under any bankmptcy law, statute
fb.\~.3166730,04 2
or regulation or other similar statute or regulation, (iii) is adjudicated a bankrupt,
(iv) makes an assignment for the benefit of creditors or applies for or consents to
the appointment of a receiver or trustee as part of or in conjunction with a
"creditor plan" with respect to any substantial patt of its assets, or (v) a receiver or
tmstee is appointed, or an attachment or execution levied with respect to any
substantial part of its assets, and said appointment is not vacated, or the
attachment or execution not released, within sixty (60) days, then this Agreement
shall, effective as of such date, without notice or further action by either party,
immediately terminate.
d. Consultant may terminate this Agreement upon the breach by EDA of any of its
material covenants contained herein, where such breach shall have continued for a
period of thirty (30) days following the receipt by EDA of a written notice from
Consultant, specifying the alleged breach; provided, however, if the nature of a
non-monetary breach is such that EDA cannot reasonably cure satne in the thirty
(30) day period, EDA shall not be deemed to be in breach if it commences to cme
within the thirty (30) day period, and diligently pursues satne to completion
within ninety (90) days following receipt by EDA of such written notice. In the
event of termination by Consultant hereunder. Consultant shall be entitled to
retain the entire fee under this Agreement.
S. Insurance.
a. During the term of this Agreement, the Consultant shall obtain and maintain
workers compensation, comprehensive general liability, and automobile liability
insurance. Comprehensive general liability insurance shall have an aggregate
limit ofTwo Million Dollars ($2,000,000.00).
b. Upon request by the EDA, the Consultant shall provide a certificate or certificates
of insurance relating to the insurance required. Such insurance secured by the
Contractor shall be issued by insurance companies licensed in Minnesota. The
insurance specified may be in a policy or policies of insurance, primary or excess.
c. Such insurance shall be in force on the date of execution of an Agreement and
shall remain continuously in force for the duration of the Agreement.
6. Indemnification.
a. Notwithstanding anything to the contrary in this Agreement, the EDA, its officers,
agents, and employees shall not' be liable or responsible in any manner to the
Consultant, the Consultant's successors or assigns, the Consultant's subcontractors,
or to any other person or persons for any third party claim, demand, datnage, or
cause of action of any kind, nature, or character, including intentional acts, arising
out of or by reason of the performance of this Agreement by Consultant. The
Consultant, and the Consultant's successors or assigns, agree to protect, defend and
save the EDA, and its officers, agents, and employees, harmless from all third party
fb.us.3166730.04 3
claims, demands, damages, and causes of action, to the extent caused by the
negligence or wrongful acts of Consultant, and the costs, disbursements, and
expenses of defending the same, including but not limited to, attorneys fees,
consulting services, and other technical, administrative or professional assistance.
b. Nothing in this Agreement shall constitute a waiver or limitation of any immunity or
limitation of any immunity or limitation on liability to which the EDA is entitled
under Minnesota Statutes, Chapter 466, or otherwise.
7. Assil!.nment. This Agreement shall not be assigned, sublet, or transferred, in
whole or in part without the prior written approval of the EDA.
8. Conflict of Interest. The Independent Contractor shall use best efforts to meet
all professional obligations to avoid conflicts of interest and appearances of impropriety in
representation of the EDA. In the event of a conflict, the Independent Contractor, with the prior
written consent of the EDA, shall arrange for suitable alternative services.
9. ComDliance with Laws. The Consultant shall comply with all applicable
Federal, State, and local laws, rules, ordinances, and regulations at all times and in the
performance of the services pursuant to this Agreement.
10. Notices. Any notices permitted or required by this Agreement shall be deemed
given when personally delivered or upon deposit in the United States mail, postage fully prepaid,
certified, return receipt requested, addressed to:
Consultant:
Greater Metropolitan Housing Corporation
15 South 5th Street, Suite 710
Minneapolis, MN 55402
ATTN: Suzarme Snyder
EDA:
Columbia Heights Economic Development Authority
590 40th Avenue NE
Columbia Heights, MN 55421
Or such other address as either party may provide to the other by notice given in accordance with
this provision.
11. Entire Al!.reement. This Agreement, any attached exhibits and any addenda or
amendments signed by the parties shall constitute the entire agreement between the EDA and the
Consultant, and supersedes any other written or oral agreements between the EDA and the
Consultant. This Agreement can only be modified in writing signed by the EDA and the
Consultant.
12. Third Party Ril!.hts. The parties to this Agreement do not intend to confer on
any third party any rights under this Agreement.
fb.us.3166730.04
4
13. Counterparts. This Agreement may be signed in one or more counterparts but
all of which taken together shall constitute one instrument.
14. Choice of Law and Venue. This Agreement shall be governed by and construed
in accordance with the laws of the state of Minnesota. Any disputes, controversies, or claims
arising out of this Agreement shall be heard in the state or federal courts of Minnesota, and all
parties to this Agreement waive any objection to the jurisdiction of these courts, whether based
on convenience or otherwise.
15. Aereement Not Exclusive. The EDA retains the right to hire other housing
program consultants, in the EDA's sole discretion.
16. Data Practices Act Compliance. Data provided to the Consultant or created by
the Consultant under this Agreement shall be administered in accordance with the Minnesota
Government Data Practices Act, Minnesota Statutes, Chapter 13, as amended.
IN WITNESS WHEREOF, the parties hereto have executed, or caused to be executed by
their duly authorized officials, this Agreement on the respective dates indicated below.
[Signature Page Follows]
fb.us.3166730.04
5
EDA:
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
By:
Its: President -Gary L, Peterson
,200 ,
Date:
By:
Its: Executive Director -Walter R, Fehst
Date:
,200_,
CONSULTANT:
GREATER METROPOLITAN HOUSING CORPORATION
By:
Its: President
Date:
,200_,
fb.\1S.3166730.04
6
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
Meeting of: January 27,2009
AGENDA SECTION: Business Items ORIGINATING DEPARTMENT: Executive
NO.7 Community Development Director
Approval
ITEM: Adopt Resolution 2009-05, BY: Sheila Cartney BY:
GHMC requesting additional DATE: January 9, 2009
financial assistance for property
located at 3805 2nd Street
BACKGROUND: On November 27,2007 the EDA entered into an agreement with Greater
Metropolitan Housing Corporation (GMHC) for the redevelopment of the residential property
located at 3805 2nd Street. At that time the property contained one single-family house on a
double lot. As part of the agreement GMHC was to demolish the house and redevelop the
site with two new single-family homes; with financial assistance from the EDA. The EDA
agreed to provide $86,647 in funding to make this project feasible for GMHC. The $86,647
was obligated through the Anoka County HRA levy. The target sales price for the homes
was $235,000 each.
To date the existing house has been demolished and no further activity has taken place on
the site. GMHC is requesting the EDA to increase the funding from $86,647 to $124,647,
(an increase of $38,000) and an extension on completion dates. According to GMHC the
need for the increase is due to the drop in home values. A new pro-forma has been
developed for this project. GMHC and the EDA have entered into a similar agreement for
property located at 4141 Jefferson Street, with the same style and type of homes being built.
GMHC has recently sold the Jefferson Street homes for $230,000 and in January entered
into a Purchase Agreement for $200,000. Based on these sales and market conditions
GMHC has set a new target sales price for the 2nd Street houses at $210,000 each. Section
3.5 (c) of the Redevelopment Agreement states "The Authority [EDA] shall not be
responsible for any deficit incurred by the Redeveloper [GMHC] in the acquisition,
construction and sale of the Minimum Improvements."
Staff suggests the EDA discuss the following options:
1. EDA amend the contract to increase the gap financing to $124,647
2. EDA amend the contract to split the gap financing increase with GMHC
3. EDA deny the request to increase the gap funding
4. EDA extend the commencement date to May 1, 2010 and completion date to
December 31,2010
The houses have not been built at this time. The EDA should consider whether or not this is
a good time to build two new homes and selling them in this market. The EDA should
consider the chance that the increase in gap requested might not be enough once the
houses actually sell and GMHC may request even more assistance. Staff has requested
GMHC to review the option of building a smaller different type of home on the subject site.
The response from GMHC was "the drop in sales value would be greater than the savings in
construction costs." This response is based on current market factors.
RECOMMENDATION:
Staff recommends the EDA direct staff to amend the agreement to extend the completion
dates by one year and to deny the request to increase the gap at this time for development
of 3805 2nd Street property.
RECOMMENDED MOTIONS:
Motion: Move to deny the Greater Metropolitan Housing Corporation's request to increase
gap financing from $86,647 to $124,647 for the redevelopment of 3805 Second Street.
Motion: Move to waive the reading of Resolution 2009-05, there being an ample amount of
copies available to the public.
Motion: Move to Adopt Resolution 2009-05, Amendment to Contract for Private
Redevelopment by and between the Columbia Heights Economic Development Authority,
Columbia Heights, Minnesota and the Greater Metropolitan Housing Corporation dated
November 27, 2007.
Attachments: Resolution, GMHC reauest and Pro-Forma,
EDA ACTION:
EDA Resolution 2009-05
Amendment to "Contract for Private Redevelopment by and Between the
Columbia Heights Economic Development Authority, Columbia Heights,
Minnesota and Greater Metropolitan Housing Corporation" dated
November 27,2007
WHEREAS, on November 27, 2007 the City's Economic Development Authority
(EDA) approved an agreement entitled, "Contract for Private Redevelopment by
and Between the Columbia Heights Economic Development Authority, Columbia
Heights, Minnesota and Greater Metropolitan Housing Corporation (the
Agreement), and
WHERAS, this contract outlined the terms and conditions for redevelopment of
property addressed as 3805 Second Street, and
WHEREAS, the end result of the redevelopment is the construction and sale of
two single family homes by Greater Metropolitan Housing Corporation, and
WHEREAS, Section 4.3 (a) "Completion of Construction" requires a
commencement date of May 1, 2008 and a construction completion date of
December 31,2008.
WHEREAS, due to economic conditions causing declining sales prices the
redevelopment project has been delayed.
NOW THEREFORE BE IT RESOLVED, The Economic Development Authority
hereby agrees to amend Section 4.3 (a) of the Agreement to change
commencement date from May 1, 2008 to May 1, 2010 and complete
construction date from December 31,2010 to December 31, 2009.
Passed this
day of
,2009.
Offered by:
Second by:
Roll Call:
President -
Executive Director, Walter R. Fehst
GREATER METROPOLITAN HOUSING CORPORATION
15 South Fifth Street, Suite 710 . Minneapolis, MN 55402
Telephone: 612- 339-0601 EXT 16 . Fax: 612-339-0608
e-mail: bbuelow@qmhchousinq.orQ . website: www.gmhchousing.org
Ms. Sheila Cartney
Assistant Community Development Director
City of Coiumbia Heights
590 - 40th Avenue N.E.
Columbia Heights, MN 55421
January 6, 2009
RE: 3805 Second Street N.E., Columbia Heights, Redevelopment
Dear Sheila:
As you know, The Greater Metropolitan Housing Corporation (GMHC) has a redevelopment contract
with the Columbia Heights Economic Development Authority for the demolition of one existing
boarded up home, and the construction of two new single family homes at 3805 2nd Street.
Unfortunately the down turn in the real-estate market has delayed and complicated our project.
Because of slow home sales and falling home values in the area, we have been forced to delay the
project until our other new homes on the market in Columbia Heights have sold. I am please to tell
you that we have finally now sold both of our homes on Jefferson Street and we can now turn our
attention and resources to 3805 2nd Street.
GMHC is requesting from the EDA an increase in the GAP funding for this project in the amount of
$38,000 to compensate for the drop in home values; Raising the GAP from $86,647 up to $124,647.
GMHC is also requesting a time extension to our contract; Commencing Construction on or before
May 1, 2009 and Substantial Completion of Construction by December 31, 2009.
Attached is a detailed Revised Pro-Forma for the project.
Also, I have looked into the option of constructing a smaller and different style of home. For example;
we could construct a split-entry or rambler style home with less finished square footage. But the drop
is sales value would be greater than the savings in construction costs. Our experience is that the two-
story model homes that we have built in Columbia Heights are the most efficient model to build, fit
nicely into the area and are the most desirable model of home to our buyers. I will continue to look
into options but I believe we have a great plan in place if we can overcome the drop in home values in
the area.
Thank you for your consideration, and if you have any questions, or need additional information,
Please call me at 612-330-0601, EXT. 16.
I
Sincerely,
L--J ~
~
Bill Buelow
Director of Construction
GMHC RESIDENTIAL PRO FORMA ':.C-,e.'
;1" ',.-
,_. _._---~- .. 'l' -...---.
;',:;
-- m..._. - ._._-~
REVISED Date: 1/06/09 ,,' .
- , -.----..--- <,'....
------~~-----_._._._- ----.-----.-- Original Revised 1-6-09
Property Address: 3805 2nd Stre",h.., Columbia Heights -
-- ~._----,-- ---- .n__
--------...- ___. .______~.u_ Project _:' Project
-' Total l; "'-'--- Total
Model: ( 2 ) Two--Story, Singl",:FalYl~ly Two Houses Two Houses
.----- - -,
-.-..----- ;~:;1;~:~
Estimated Construction Costs for Two Houses I;\\W~;
Demolition and Site Clearing $15 000,;i;'2~'--$15 000
. ----... I '_,~'l;." ,
Contractor base price $230,000~~;\; $225,000
GMHC ~ewer I_VVater Installation $ 14,0001;[i,";, $14,000
Street Paving ----. $Oi'(1: $0
GMHC appliance package $3,000 li::;(" $3,000
...---.-....-
GMHC lumber package $92,000 Ii::!,"~ $89,000
GMHC cabinets and toes ::-:::mll~!: $12,bOO
..-.-... .--
GMHC security system ( NIC L___.___. $0
Contingency -.----- $7.000
------.
Total Construction Costs wi Conti_n!!.ency __ __ $377,000 V $365,000
___..__.m
Estimated ...-- ..._-_.__..._--~-_.._.__.- -.- ~ .~.,'" .------------.
Soft Costs
----~_.-----------_..._- .-...-,--- -.~-- ,-----. __.n_
Financing interest ..--- ----.....------ ~- $12,000. : ~12,01l.Q.
-.-.---
Property taxes . --- ~_.__._..- -~--_._--_._. -- 11,2_82 [ii'!!1 . $1,282
Outstanding Assessments $1915",'1-;" $1,915
Insurance - :t~~~ !~(!ll -- -- $900
-- ---
Title and reco~_____ -- $1,200
--
Survey $3,000
Marketing and Closing costs --.-. ..--- $25,200 ~rr';:" .. $25,200
~eraisals $650 ii'-}:,:' $650
.-.... -. -- ...- '-','..Y'~---
\Jtilities ... $1,200[.';;' $1,200
_.~;~!,'.':,,'~._~_.~--
Property management (est. 3 months) -- $1,200;,'1,:", $1,200
Architect fees I Printing I Advertisement $600 ,,:[!.(: $600
. :f",,,,_.".
Soil Testing $1 ,500 [l'3;f,: $1,500
-- --- iQ~Wii) iQ
Legal ....-. -
Total Soft Costs -- $50,647 ~1)i:!ri $50,647
- - ~----_.- ,
~-_....... ----.-------.-.---. -- ..---- -~._.~,-,
_La_nd Acquisition Costs $105,0001 ,~__ $105,000
-----~- --- .-.-.-.--. -------
----- _n____ ~-~_..- -- $24.000' " -- ------.-
QI\III:IC Developer fee ~24.000
.
~~ _._n . $556,647 ,::,;; $544,647
Total Development Costs
.--- ~- '-J.:;"
~:,;";-'"
-- .-_.~----- kj;k.-".
Estimated Sale Price $470,000 ;1 "", $420.000
-...-- --- -
~-- -- -- -- ---- ',>:-.
GAP $86,647 ~:i,:__,..r $124,647
".~:' ;.::.:
(;~:;,~~:
Requested increase in GAP funds of $ 38,000 for Total of $ 124,647 I I
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of: January 27,2009
AGENDA SECTION: Business Items ORIGINATING EXECUTIVE
NO: 8 DEPARTMENT: EDA DIRECTOR
APPROVAL
ITEM: Commercial Development BY: Scott Clark BY:
Agreement for 4707 Central DATE: January 16, 2009
Avenue
BACKGROUND:
On September 23, 2008 the Economic Development Authority approved a Redevelopment
and Tax Increment Agreement with Grand Central Commons, LLC for development of a
52,000 sq.ft. commercial/office space project located at 4ih and Central Avenue. This project
had a number of issues, specifically the need for sewer expansion along Central Ave. and
some leasing issues, that made a fall construction in 2008 questionable. The developer has
relooked at the project's economics and come back with a different proposal. The original plan
(attached) would be changed by eliminating the second floor above Aldi's, and decreasing the
overall project space to 35,000 sq.ft. The purpose of this agenda item is two-fold: 1) to garner
if the EDA supports giving tax increment assistance to the new project and 2) the willingness
to have a special EDA meeting on February 9, 2009 to act on a new agreement. The key
changes would be:
1) Reduction of project size from 52,000 sq. ft. to 35,000 sq. ft. and reduction of the parking
ramp to 180 stalls (230 was the original target).
2) A proportional decrease in tax increment assistance (estimated between $300,000 and
$330,000) and the minimum assessment amount.
3) Staff will need to confirm the Metropolitan Council's acceptance of the project changes
4) Re-establishing new start and completion dates. At this time, if the developer is to
receive tax increment financing he will need to incur his tax increment qualified costs
(meaning actual expenditure of the TIF amount) by July 23, 2009.
5) Outside of the EDA's approval, this project would have to go back to the Planning
Commission, possibly the City Council, and undergo new building permit reviews.
RECOMMENDATION: If the EDA is in consent with the new project outline, staff
recommends a special EDA meeting on February 9, 2009 to review an amended agreement.
RECOMMENDED MOTION: Move to set a special EDA meeting for Monday, February 9,
2009 at 6:30 p.m. in the City Hall, Conference Room 1.
Attachments: Revised Development ConceDt Drawino
EDA ACTION:
G:/Communily DevelopmenVEDNKhoraUy Development Agreement revision 1-27-2009
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COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of: January 27, 2009
AGENDA SECTION: Business Items ORIGINATING DEPT. EXECUTIVE
NO: 9 Community Development DIRECTOR
APPROVAL
ITEM: Adopt Resolution 2009-07, Schafer BY: Sheila Cartney BY:
Richardson Redevelopment Timeline DATE: January 16, 2009
BACKGROUND:
On October 25, 2004 the City, EDA and Huset Park Development Corporation entered into contract for
private redevelopment of the "Industrial Park." On August 1, 2007 the same parties agreed and entered
into an Amended and Restated Contract for Private Redevelopment.
The "Minimum Improvements" in the contract is broken out into phases and includes three different
housing types and one commercial space. According to the contract there are to be a total of 277
townhouse units, 50 senior units, and 183 condominium or cooperative housing units and 11,650
square feet of commercial space.
Due to the down turn in the housing market and economic conditions, Schafer Richardson has
requested completion date amendments to the development contract. The following table represents
the amendments requested per phase.
Phase
IB Housin
IIA Housin
liB Housin
IliA Housing
and
Commercial
IIIB Housing
Commence by 12/31/2010 complete by
12/31/1012
Commence by 12/31/2012 complete by
12/31/2014
IIIC Housing
Staff supports the proposed changes in dates. At the time of drafting of this memo, the final
Resolution was not received by the Attorney and will be handed out at the EDA meeting.
RECOMMENDATION: Staff recommends the EDA amend the development contract as requested to
change commencement and completion dates for the units in the Huset ParklParkview Development.
RECOMMENDED MOTION:
Move to waive the reading of Resolution 2009-07 there being amble copies available.
Move to Adopt Resolution 2009-07 amending the development contract between Schafer Richardson
and the EDA dated August 1, 2007, changing commencement and completion dates.
EDA ACTION:
Attachments: Resolution, Reauest from Shafer Richardson, Phase MaD
I) Redevelopment Agreement Deadlines and suggested modifications.
Phase IA- ok
Phase IB- Senior Rental, change from "Cooperative," 80% complete by 12/31/2010.
This is possible by 4/30120 II with fall 20 I 0 construction start.
Phase IIA- 103 Total, 80% (82.4) complete by 4/3012009. Currently 47 done or under
construction (46%). According to our agreement with Ryland:
16 units sold to Ryland in 10/08. Won't start until 50% units sold.
18 lots purchased 4/09 by Ryland. Earliest completed is October 2009 (depending on
sales).
2 more lots (to get to 80% complete) purchased 12/09 by Ryland. Earliest completed is
June 2010.
Phase IlB- 51 Total, 80% by 12/31/2009. March 2011 purchase by Ryland according to
our agreement. Earliest complete is July 2012.
Phase IIIA- Commence by 12/31/08, complete by 12/3112010. Suggest commence by
4/20 I 0 and complete by 4/2012
Phase IIIB- Commence by 12/31/2010, complete by 12/3112012. Suggest commence by
12/31/2012, complete by 12/31/2014
Phase IIIC- Commence by 12/3112012, complete by 12/31/2014. Suggest commence by
12/31/2014, complete by 12/3112016
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COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of: January 27, 2009
AGENDA SECTION: Business Items ORIGINATING EXECUTIVE
NO: 10 DEPARTMENT: EDA DIRECTOR
APPROVAL
ITEM: Adopt Resolution 2009-04, BY: Scott Clark BY:
Decertification of TIF Districts DATE: January 22,2009
P3/P4/S7
BACKGROUND:
This is an administrative clean-up item for the EDA. ON February 27,2007 the EDA was
presented a TIF decertification resolution for a scattered site redevelopment district
(P3/P4/S7) that statutorily ended on December 31,2006. The EDA had some additional
questions but current staff can't find a trail as to any continuance of this action. Because the
EDA did not take an official action the County continues to send tax increment receipts to the
City, but these are simply being held in an account since the district has ended. Upon action of
this item by the EDA, the aforementioned receipts will be returned back to the County who will
then redistribute the proceeds to the respective governmental entities.
RECOMMENDATION: Staff recommends approval of Resolution 2009-04 as written.
RECOMMENDED MOTION:
Motion: Move to waive the reading of Resolution 2009-04, there being an ample amount of
copies available.
Motion: Move to Adopt Resolution 2009-04, a Resolution Approving the Decertification of Tax
Increment Financing District P3/P4/S7 of the City of Columbia Heights EDA.
Attachments' Resolution 2009-04
EDA ACTION:
G:\Community DevelopmentlEDA 2009\Res.2009-04. Decertification of P3,P4,S7 TIF Districts
CITY OF COLUMBIA HEIGHTS ECONOMIC DEVELOMENT AUTHORITY
COUNTY OF ANOKA
STATE OF MINNESOTA
RESOLUTION NO. 2009-04
RESOLUTION APPROVING THE DECERTIFICATION
OF TAX INCREMENT FINANCING DISTRICT P3/P4/S7 OF THE CITY OF
COLUMBIA HEIGHTS EDA
WHEREAS, on May 27, 1997, the City of Columbia Heights Economic Development
Authority (the "EDA") created its Redevelopment Tax Increment Financing District No. P3/P4
(Housing TIF #1) (the "District"), within the Central Business District Redevelopment Project (the
"Project").
WHEREAS, on December 17, 2001, the EDA expanded the geographic boundaries of
the district (the S7 geographic enlargement).
WHEREAS, an Internal Fund Loan obligation, previously authorized, has been paid and
the obligation is no longer outstanding, and
WHEREAS, there are no parcels located in the District which currently have delinquent
taxes under the duration limits; and
WHEREAS, the Tax Increment Financing plan adopted on May 27, 1997 for Tax
Increment Financing District No. P3/P4/S7 requires, pursuant to M.S. 469.176, Subd.1 b (a) (4)
redevelopment districts, that the duration of the Tax Increment Financing District P3/P4/S7
Housing TIF #1 will be 25 years from the receipt by the EDA of the first tax increment, and
WHEREAS, the receipt of first tax increment was July of 1998; and
WHEREAS, December 31, 2023 is 25 years from the first receipt of increment, or the
statutorily required expiration date, and
WHEREAS, the EDA desires to decertify the District prior to its statutorily required
expiration date; and
NOW THEREFORE, BE IT RESOLVED by the Economic Development Authority of the
City of Columbia Heights that the EDA's staff shall take such action as is necessary to inform
the County Auditor of Anoka County that the District is decertified and to no longer remit tax
increment from the District to the City.
Approved by the Board of Commissioners of the Columbia Heights Economic Development
Authority this _ day of 2009.
ATTEST:
Executive Director- Walter R. Fehst
President
(Seal)
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
Meetina of: January 27, 2009
AGENDA SECTION: Business Items ORIGINATING Executive
NO.11 DEPARTMENT: Community Director
Development Approval
ITEM: Adopt Resolution 2009-06, Amend Contract BY: Sheila Cartney BY:
with GHMC for Additional Financial Assistance for DATE: January 9, 2009
Property Located at 4141 Jefferson Street
BACKGROUND: On May 14, 2007 the EDA entered into an agreement with Greater Metropolitan
Housing Corporation (GMHC) for the redevelopment of the residential property located at 4141
Jefferson Street. At that time the property contained one single-family house on a double lot. As part
of the agreement GMHC was to demolish the house and redevelop the site with two new single-family
homes; with financial assistance from the EDA. The EDA agreed to provide $65,050 in funding to
make this project feasible for GMHC. The $65,050 was obligated through Fund 226 "Special
Projects." The target sales price for the homes was $235,000 each.
To date the existing house has been demolished and two single-family homes have been constructed
on the site. GMHC is requesting the EDA to increase the funding from $65,050 to $88,850, (an
increase of $23,800). According to GMHC the need for the increase is due to the drop in home
values; both homes have sold for under the anticipated sales price. One home sold for $230,000 and
the other for $200,000. A new pro-forma has been developed for this project that itemizes the actual
costs. Section 3.8 of the Redevelopment Agreement states "The Authority [EDA] shall not be
responsible for any deficit incurred by the Redeveloper [GMHC] in the acquisition, construction and
sale of the Minimum Improvements."
Staff suggests the EDA discuss the following options:
1. EDA amend the contract to increase the gap financing to $88,850 as requested
2. EDA amend the contract to split the gap financing increase with GMHC
3. EDA deny the request to increase the gap funding
The objectives of the development agreement have been met. The market conditions have forced the
sales of these two single-family homes to be less than what was anticipated two years ago. Because
the site has been developed according to the agreement and the houses are now owner occupied,
staff suggests the EDA split the requested gap increase. The difference dividing by 50% equals
$11,900, if this occurs the EDA would be providing $76,950 in gap financing. Fund 226 has a balance
of about $200,000.
RECOMMENDATION: Staff recommends the EDA split the new gap with GMHC and provide
$11,900 more in financing using Fund 226-Special Projects.
RECOMMENDED MOTION:
Motion: Move to waive the reading of Resolution 2009-06, there being an ample amount of copies
available.
Motion: Move to Adopt Resolution 2009-06, Amendment to Contract for Private Redevelopment by
and Between the Columbia Heights Economic Development Authority, Columbia Heights, Minnesota
and the Greater Metropolitan Housing Corporation dated, May 14, 2007.
Attachments: Resolution, GMHC reauest and Pro-Forma,
EDA ACTION:
EDA Resolution 2009-06
Amendment to "Contract for Private Redevelopment by and Between the Columbia
Heights Economic Development Authority, Columbia Heights, Minnesota and
Greater Metropolitan Housing Corporation" dated May 14, 2007
WHEREAS, on May 14, 2007 the City's Economic Development Authority (EDA)
approved an agreement entitled, "Contract for Private Redevelopment by and Between
the Columbia Heights Economic Development Authority, Columbia Heights, Minnesota
and Greater Metropolitan Housing Corporation (the Agreement), and
WHERAS, this contract outlined the terms and conditions for redevelopment of property
addressed as 4141 Jefferson Street, and
WHEREAS, the end result of the redevelopment is the construction and sale of two single
family homes by Greater Metropolitan Housing Corporation, and
WHEREAS, the agreement called for payment of up to $65,050 in gap financing by the
Economic Development Authority pursuant to Section 3.3(a), and
WHEREAS, due to economic conditions causing declining sales prices the
redevelopment gas has increased to $88,850, an increase of $23,800, and
WHEREAS, The EDA is "not responsible for any deficit incurred by the Redeveloper
(defined within the Agreement as Greater Metropolitan Housing Corporation) in the
acquisition, construction or sale of the Minimum Improvements", and
WHEREAS, although not obligated to provide additional funding, the EDA is electing to
divide the increased gap financing amount by 50% ($11,900) for a total assistance of
$76,950.
NOW THEREFORE BE IT RESOLVED, The Economic Development Authority hereby
agrees to amend Section 3.3 (a) of the Agreement to increase the amount of Authority
Assistance to $76,950. The Authority Assistance shall be paid from Fund 226 "Special
Projects."
Passed this
day of
,2009.
Offered by:
Second by:
Roll Call:
President -
Executive Director, Walter R. Fehst
GREATER METROPOLITAN HOUSING CORPORATION
15 South Fifth Street, Suite 710 . Minneapolis, MN 55402
Teiephone: 612- 339-0601 EXT 16 . Fax: 612-339-0608
e-mail: bbuelowrawmhchousim1.orQ . webslte: www.gmhchousing.org
Ms. Sheila Cartney
Assistant Community Development Director
City of Columbia Heights
590 - 40th Avenue N.E.
Columbia Heights, MN 55421
January 6, 2009
RE: 4141 and 4139 Jefferson Avenue N.E., Columbia Heights, Redevelopment
Dear Sheila:
As you know, The Greater Metropolitan Housing Corporation (GMHC) has a redevelopment contract
with the Columbia Heights Economic Development Authority for the demolition of one existing
boarded up home, and the construction of two new single family homes at 4141 Jefferson Ave. I am
pleased to report that we have finally accepted a purchase agreement for the last available house.
Unfortunately, we are in a position where we needed to accept considerably less for the two homes
than we had anticipated. The down turn in the real estate market has dropped home values in the
area significantly.
GMHC is requesting from the EDA an increase in the GAP funding for this project in the amount of
$ 23,800 to compensate for the drop in home values raising the GAP from $ 65,050 up to $ 88,850.
Attached is a detailed Pro-Forma for the project. The Pro-Forma itemizes our actual project costs
compared to our pre-construction projections, which our re-development contract was based.
To summarize the Pro-Forma;
. Column "A" represents the pre-construction projected costs, and Column "B" represents the
actual project costs.
. The Actual total Construction Costs were $ 20,474 under our budget.
. The Actual total Soft Costs were $ 4,218 over budget. The over runs are caused by the
excessive holding costs.
. Our Total Development Costs were $ 16,200 under our budget.
. Our Income from sales of the two new homes was $40,000 less than anticipated.
. Our GAP needed for this project is $ 88,850. This represents our requested increase of
$ 23,800 in GAP funds.
Thank you for your consideration, and if you have any questions, or need additional information,
Please call me at 612-330-0601, EXT. 16.
Sincerely,
t-.-)- ~
Bill Buelow
Director of Construction
Date: REVISED 1~06.09
GMHC RESIDENTIAL PRO FORMA
4141 Jefferson Street, ColumbIa Heights
Property Address:
Model: (TwoY- 2-Story Single Famllv 1670 SF
Estimated Construction Costs
Demolition and Site Clearin~
Contractor base price
GMf-IC Sewer J Water InstallatIon
GMHC aooliance nackaaa
GMHC lumber pack.age
GMHC cabinets and to s
GMHC securltv system ( NIC
Contingency
Total Construction Costs wI Contlnooncv
Estimated Soft Costs
Flnancinn interest
Pronertv taxes
Insurance
Tille and record Inn J lenal
Survey
Closing costs and Marketlng
Annraisals
Utililles
Prooert mana;,ement lest. 3" months\
Architect fees I Printinn I AdverUsment
Soil Testlnn
Legal
Total Soft Costs
Land Acquisition Costs
GMHC Developer fee
Total Development Costs
Estimated Sale Price
GAP
B:!\l):(~P.~:~1\~Jn~r~~~~iQf;$:~~i~PP'!I;ii?\;ifr;. ':,.
';,; ~; ,;\ . .>,. ,. . ~.' . \,
",.," " .,. ..:'(':'1 ; ~ ;':,
I
Pre-Con Estimated Costs '::(',
C-ltv-Contract City Contract ~~~~;i
;r.ti:'p
Project t[1;~\:. Total
T ,~~f'
otal l\&<i,l Two Houses
'(Ii-'
Two Houses~~~*lJ
'!,!~l
~R~1f~b}j!.~1~!..mt~~)~~~~fi;:-1~[tiilJl~ltii}fJil
~\'.!;;:,I:
$15,000n';;iii
$230 000 *~;~U
~.Jt1:'
$14 000 tti~~~
$3.000 l~~~;
$92,000 ;1i~.ll
$13,OOOq,~~\1
$0 \YMl
:Il10 OOQJ:i\\I!f-
"~~.~\i
$377,000 ,,:W $366,526 $177,511,
'}r'/; --~.~~- ---~- .-.-
Averaoe
Cost Per
House
$7 500
$115000
$7,000
$1500
$46.000
$6.500
$0
$5.000
$168:500
$6 000
'300
--'-450
$600
$1500
- $12,600
$325
$600
$600
'300
$750
M!
$24,025
$43,000
$12.000
$267,525
235 00
$32,525
" 'l ::,:,:::}\::,~'~i%:),~;!(:;.~wm;:::;.\'i;J::j~::::::rg,: J,
116/2009
Actual
$0
$319480
$17,000
$6 779
$0
$10.867
$2 400
M!
$12,00oi::(!?--~5.8o:i
$600 ~1~~;i $3,077
$900!lh~!: $1917
$1.200 i::,~' $0
$3.000 ~~.~t $1,505
$25.200 !~;ri! $25,642
$650 !J~~8:~j~ $0
$1.200~\~I;i!: $1475
$1 200i;N(~: $2158
$600 '~i::~J $113
$1 500 ,r"!i $0
I'
.$.Q ~~I!1 $578
$48,050 ,i';\) $52,268
ii~tr------.
~:~~il
$86 000 .:hi'" $86,056
, ~f::Wi~
$24.000 _!\~;! $24,000
$618,850
0430 000
$68,850
SOLD
1/6109
Actual
4139
House
$0
$159.101
$8 500
$2.763
$0
$5,927
$1200
$0
$7,971
$0
$612
$0
'752
$12821
$0
$746
$1.397
$50
$0
M!
$24,351
SOLD
10/39/08
Actual
4141
House
$0
$160.379
$8 500
$3,996
$0
$4940
$1200
~
$179,015
---$7,832
$3.077
$1,305
$0
$753
$12821
$0
$727
$761
$63
$0
'578
$27,917
$43,028 $43,028
$12,000 $12,000
$256,890 $261.960
200 000 $230.000
$56,890 $31,960
--
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Administrative Report
1) Pursuant to discussions with the City Council in December, on January15,
2009 staff met with State Representative Carolyn Lane regarding
legislation that would extend the five- year rule for the Kmart
Redevelopment Tax Increment Financing District. Attached is all of the
material that was presented to her at that time, Staff will give an update to
the EDA at the meeting,
2) At the EDA meeting, staff will distribute a booklet entitled, "Columbia
Heights Industrial Park Redevelopment Project" that details the history of
the Husetllndustrial Park redevelopment efforts,
Columbia Heif!ltts Five-Year Rule Amelldmellt LeJ!islatioll
Wltat tax illcremellt legislatioll is tlte City of Columbia HeiglIts proposillg?
The City's Economic Development Authority ("EDA") is requesting an extension
of the five-year rule under Minnesota Statutes, Section 469.1763, subdivision 3 for the
Kmart/Central Avenue Tax Increment Financing District (the "TIF District") from an
ending date of July 23, 2009 to July 23,2014. The subject rule limits the EDA's ability to
issue any new obligations or enter into contracts after five years from the original date of
certification.
Wltat is tlte Itistory of tlte existillg tax illcremellt district?
The TIF district was certified by Anoka County on July 23,2004 as a 15 year
"Renewal and Renovation District." and will expire on December 31, 2021. The District
was created to assist in redeveloping a vacant Kmart site into 218 units of owner
occupied units consisting of 198 condominiums (3 buildings comprised of 66 units each)
and 20 town homes and thc construction of a minimum amount of 10,000 sq ft. of
commercial space. Due to housing market conditions and over-building of the
condominium market, only 10 of the townhouse units and 66 of the condo units have
been constructed. In addition, the EDA has an approved development agreement in place
for the commercial space, but this project is also on hold due to economic considerations.
The City has serious concerns with a proportionately high number of foreclosure
units located in a neighborhood adjacent to the TIF district, the EDA is in the process of
modifying the district to geographically add this area. The neighborhood is rapidly
deteriorating and is comprised primarily of 50 duplex units that have a 24% foreclosure
rate, serious crime issues and overall physical building and infrastructure decay (map
attached). The unobligated increment generated from the existing TIF district, and the
modified area, would be utilized by the EDA to acquire the foreclosed homes and either
remodel them for resale or demolish the structures and resell the lots for construction of
new homes.
Wit at repercussioll does tlte City of Columbia Heigltts face by Ilot gettillg tlte five-rule
extellsioll ?
Once the five-year period has been reached any new obligations (e.g. pay-as-you
go notes or bonds) would be treated as expenditures outside the district and subject to
strict pooling limits. The net effect is that new obligations are not practically possible in
any significant amount. This creates the following ramifications to the City of Columbia
Heights:
1) The EDA currently has an approved developer's agrecment for a 50,000 sq. ft.
retail facility. This proposal calls for $440,000 in tax increment assistance by
means of a pay-as-you-go note. Due to the severe economic climate this
project may not be constructed until late 2009 or possibly 2010. Because the
costs to be reimbursed with a pay-as-you-go note will not have been spent
within the five-year deadline, the agreement could not be implemented and the
project would be lost.
2) The EDA is expanding the 'I'll' District to help address the severe foreclosure
crisis in the City, with the goal of using increment to help acquire and
rehabilitate or otherwise redevelop the affected housing. However, such
eligible costs cannot be incurred with the five-year rule limit, so the
opportunity to use the increment from the 'I'll' District for this critical effort
will be lost.
What are the overall benefits to the City by securing this amendment?
This extension allows the EDA to I) complete the original redevelopment goals
for the TIl' District, by ensuring that the existing commercial project can be successful if
economic considerations force its delay into late 2009 or 20 I 0, and 2) leverage the
increment for thisI'll' District to help address the foreclosure crisis in an area adjacent to
the original TIl' District, which also helps prevent the emergence of blight that might
impair the EDA's investment within the original 'I'll' District boundaries. Like many first
ring suburbs, (and indeed, the State as a whole), the City has been affected by general
economic decline that has created significant delay in development projects, compounded
by a serious foreclosure problem, all of which has created the need to amend this time
sensitive rule in order to complete a difficult and complex redevelopment project.
Kmart I Central Ave. TIF District and
Proposed Amended Area
-' --J c-"'-~ ~
<( :;: ~ <; ~ M ~ u; ;: ~ ~
0:: <D N "' 0 N
I- -.::.. 0 0 ~ :: ~ :: ~ ~ N N
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z
w ...... 49TH
u \-
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rmllliIJ]
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\..: ,"L'JtEW=
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: "~ ::: ~I ~ "
::~~:~""
4624 4629::::;i62L:1H!::
~7 ::~: o:::llit ;4618
:.: 4609 4608 g 4607 ~
/?' 4"06 4606 >-
'0 _ 1111 ~
........ ...:;...........~
I II 4556 4555 V..4656 4557 4554 4555 3HE
Area Being Processed (4550 4549 4548 4549 4550
for Modification r 4546 4543 4543 4546
4540 4542
4536 4537
4536
4530 4531
4526 4525
4520 4519
4811
4801
4757
~
?/
-
4707 0 4729
Z
<(
~
<.9
.
124% Foreclosure Rate ~ 4657
t;
'" I '" I '" 4653
46a7
4634 4641
4633 ~~
4628
4622
4621 4619
4616
4615
4605 tt 4607
>= 1001
4532
4535
if
4517
1*- Foreclosed Property
1 r-
o 1039
.>',1"'0\3:.: Original District 1
~ BOREALIS LN
fo 'r-- to co co
~ / ~ U) 0 ....
.... t::.... N N
/" .... .... ....
)' -'\ ~ M In Ln
~'{,> '1J,~~N
1131 KH;B;R:N
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.... ""'.... N N
/,... .... .... ....
~~~\LO M....M
1- ..;. !V~~ Fl ~N
I); ~ (\ ~ ~~~~~
~ ~;;;;;~;
1070
UNITS:
100-119,200-209,300-320,400-415
1069
4535
4534
4534
4530
II
Location Map
-
4653 4650 I- 465
4645 4644 464
4639 4638 ~
4633 4632 ~
4627 4626 ~
4621 4620
4615 4614 ~ 461
4609 4608
~ 460.
4603 4602 a.=-
4557
4555 ~ 0 0 0 0
'" <D
B~ N N ... 0
N "
~ ~ ~ ~
4539 '" "' ~ ... "
_0 ~ N N 0
4531 ~ N N N "
~ ~ ~ ~
451/2
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